Environmentally Adjusted Multifactor Productivity

Environmentally adjusted multifactor productivity

EAMFP growth measures the residual growth in the joint production of both the desirable and the undesirable outputs that cannot be explained by changes in the consumption of factor inputs (including labour, produced capital and natural capital). Therefore, for a given growth of input use, EAMFP increases when GDP increases or when pollution decreases.

As part of the growth accounting framework underlying the EAMFP indicator, the growth contribution of natural capital and growth adjustment for pollution abatement indicators are derived:

_Growth contribution of natural capital _- measures to what extent a country's growth in output is attributable to natural resource use;

_Growth adjustment for pollution abatement _- measures to what extent a country's GDP growth should be corrected for pollution abatement efforts - adding what has been undervalued due to resources being diverted to pollution abatement, or deducing the 'excess' growth which is generated at the expense of environmental quality.

For further details on the methodology please consult:

oe.cd/eamfp

Environmentally adjusted multifactor productivity: Accounting for renewable natural resources and ecosystem services