Comprehensive wealth focuses on the role of people, the environment and the economy in creating and sustaining well-being. Complementing indicators like gross domestic product (GDP) and addressing issues the can’t capture on their own, comprehensive wealth measures are key to successfully guiding Canada through the 21st century and beyond.
This study reviewed Canada’s comprehensive wealth performance over the 33-year period from 1980 to 2013. This timeframe extends well beyond business and political cycles, ensuring that the results reveal trends free from the ebb and flow of markets and policies. The report found that comprehensive wealth grew slowly in Canada between 1980 and 2013 (0.19 per cent annually in real per capita terms). This was in contrast to relatively robust growth in real per capita consumption of goods and services (1.36 per cent annually). The divergence between these two trends points to potential concerns for long-term well-being.
In terms of the components of comprehensive wealth:
- Produced capital was the bright spot, growing by 1.68% annually from 1980 to 2013, though most (70%) of this growth was concentrated in the oil and gas extraction industry and housing
- Market natural capital (fossil fuels, timber, minerals and farmland) declined by 0.93% annually (for a total drop of 25%)
- Non-market natural capital (ecosystems and climate) declined based on a set of non-monetary indicators
- Human capital, which accounts for about 80% of Canada’s comprehensive wealth, did not grow at all, meaning that average lifetime earnings prospects in 2013 were no better than in 1980
- Social capital appears to have been stable based on a suite of non-monetary indicators.
Comprehensive Wealth rose 7%, or .19% per year from $592000 in 1980 to $631,000 in 2013 as Market Natural Capital fell from $39,800 to $29,200 per person.
Green Growth Knowledge Platform http://www.greengrowthknowledge.org
Source: International Institute for Sustainable Development (IISD)