Adjusted net national income per capita 2014

Definition of adjusted net national income:

“Adjusted net national income is GNI minus consumption of fixed capital and natural resources depletion.” – World Bank 

adjusted net national income per capita, 2014 (Custom)

Statistical concept and methodology:

“Adjusted net national income complements gross national income (GNI) in assessing economic progress (Hamilton and Ley 2010) by providing a broader measure of national income that accounts for the depletion of natural resources.

Adjusted net national income is calculated by subtracting from GNI a charge for the consumption of fixed capital (a calculation thatyields net national income) and for the depletion of natural resources. The deduction for the depletion of natural resources, which covers net forest depletion, energy depletion, and mineral depletion, reflects the decline in asset values associated with the extraction and harvesting of natural resources. This is analogous to depreciation of fixed assets.” – World Bank 

Development relevance:

“Adjusted net national income is particularly useful in monitoring low-income, resource-rich economies, like many countries in Sub-Saharan Africa, because such economies often see large natural resources depletion as well as substantial exports of resource rents to foreign mining companies. For recent years adjusted netnational income gives a picture of economic growth that is strikingly different from the one provided by GDP.

The key to increasing future consumption and thus the standard of living lies in increasing national wealth – including not only the traditional measures of capital (such as produced and human capital), but also natural capital. Natural capital comprises such assets as land, forests, and subsoil resources. All three types of capital are key to sustaining economic growth. By accounting for the consumption of fixed and natural capital depletion, adjusted net national income better measures the income available for consumption or for investment to increase a country’s future consumption.” – World Bank 

Source:

“World Bank staff estimates based on sources and methods in World Bank’s “The Changing Wealth of Nations: Measuring Sustainable Development in the New Millennium” (2011).” – World Bank 

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