The Arrow et al. paper is a welcome addition to a large literature on the linkage between asset values and social welfare. This literature has its roots in the concern about ‘greening’ the national accounts, but the paper shows how expanding the asset boundary beyond produced and natural goods could increase our measures of income, saving and wealth enormously. I will comment in turn on the wealth accounts, investment accounts and the treatment of CO2 emissions, using selected World Bank figures as a basis for comparison.

The world's leaders, business leaders and the public at large are beginning to question, amidst the multiple social, environmental and economic crises, whether our present trajectory of economic growth is sustainable. We seem to force ourselves to believe that we can grow ourselves out of the multiple crises we face today. The notion of sustainable development and the call for going beyond just material wealth to gauge our wellbeing has long featured in much of the sustainable development, environmental and ecological economics literature. We are afraid the present preoccupation with the green economy will not provide the change we are looking for if we don't address the fundamental problem of what we are aiming to achieve and how we measure our progress towards achieving those goals. We fall into the trap many international agencies have made over the past six decades, where the means become the ends and the ends become an academic exercise (Chang, 2001).

How sustainable is the growth pattern of a national economy? At first, answering this question seems almost impossible, since this would require knowing what happens and what can happen in the future. One needs to assess whether the investments we make today will be sufficient to provide future generations with the means to cope with imminent disasters like the exhaustion of minerals and vital resources, or other problems like increasing population pressure and climate change. One also needs to assess which combination of investment leads to the desired result. If entrepreneurs, managers and households already have problems in finding out what is the best mix of investment for them in their micro-environment, how can we answer the aggregate question that needs so much more information?

The Indian economy has grown rapidly at 6–8 per cent per year since 1995 and planners aim to sustain an 8 per cent growth rate in the next years. Growth has created considerable optimism about India and its place in the world. After many years of little change, poverty appears to be on the decline with an estimated 5–7 per cent reduction in the late 1990s (Sundaram and Tendulkar, 2003a, b, c; Deaton, 2005). Life expectancy increased from 59 years in 1991 to 64 years in 2008 and the primary school completion rate was at 96 per cent in 2008 (World Bank, 2012). Economic growth has resulted in a boom in the manufacturing and service sectors, large investments in infrastructure and energy projects, and a soaring middle class.