Balbharati solutions for Economics HSC 12th Standard Maharashtra State Board
Chapter 7. National Income
4. Explain the concept of Green GNP.
Answer: -
Concept of Green GNP:
It is defined as, “Green GNP is an indicator of sustainable use of the natural environment and equitable distribution of benefits of development.”
Gross National product does not take into consideration the cost in terms of (i) Environmental pollution, (ii) Depletion of natural resources caused by the production of output. A mere increase in GNP will not reflect an improvement in the quality of life when it increases environmental pollution or reduces available resources for future generations. So Green GNP has been introduced while measuring economic welfare.
The following are the characteristics of Green GNP:
a. Sustainable economic development, i.e. development which should not cause environmental degradation (pollution) and depletion of natural resources.
b. Equitable distribution of benefits of its development.
c. Promotes economic welfare for a long period of time.
Measurement: Green GNP = GNP - (Net fall in the stock of natural capital + pollution load.)
