Advancing testing of the genuine savings hypothesis: The use of comprehensive measures of technical change for Ireland

The success of sustainable development policy depends on the well-being prospects of future generations, which, in turn, hinge on the effective management of environmental and other capital resources. This insight forms the foundation of the capital theoretic or wealth-based approach to sustainable development, with the Genuine Savings (GS) indicator a measure of changes in comprehensive national wealth - serving as a key metric. Real-world indicators often fall short of their theoretical equivalents thus their role in practical environmental management policy is criticised. However, the relevant question is, do real-world indicators conform to testable theoretical propositions? The modern GS literature conducts tests on conventional savings followed by more comprehensive variants and has emphasised the role of exogenous technical change. The key contribution of this paper is to utilise recent advancements in measuring technological progress applied to historical Irish data. Irelands atypical development experience offers an interesting challenge to GS theory conformity. Overall, the most comprehensive GS variants were consistent with the underlying economic theory and thus provides continued support for the use of practical wealth-based sustainable development metrics.