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Air pollution and green accounts

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A simple model treating air emissions as cumulative pollutants is used to derive measures of ‘green net national product’. The model implies that pollution emissions are properly valued at their marginal social costs in the measurement of green NNP. The level of genuine savings, net savings less the value of resource depletion and pollution emissions, is shown to provide a useful indicator of sustainable development. Recent figures on the social costs of fuel cycles are used to derive genuine savings measures for the UK and other European nations. Several countries had negative genuine savings during the 1980s.

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