Per capita

Demography

Ecology

Biology

Financial capital

Sustainability

Depreciation (economics)

Economics

Development economics

Political science

Population

Sustainable development

Sociology

Human capital

Natural resource

Natural capital

Capital formation

Sustainable growth rate

Economic growth

Population growth

Finance

Natural resource economics

Per capita income

Ecosystem services

Ecosystem

Bulletin of Indonesian Economic Studies

We explore the nexus between sustainability and economic growth in Indonesia between 1990 and 2014, using an inclusive wealth framework that covers the country’s unique resources and biodiversity. Indonesia’s inclusive wealth growth is considered positive. However, the ‘dilution effect’ on Indonesia’s population has outpaced the country’s wealth growth, so that its per capita inclusive wealth growth has been negative. This study implies that the GDP per capita growth in Indonesia does not necessarily indicate sustainability. The depreciation of both renewable and non-renewable natural capital is driving the decline in wealth per capita. Despite this, sustainability has been improving, although marginally, due to increases in the rates of produced and human capital growth. To return to a sustainable growth path, Indonesia must increase its investments to a net gain in the rate of wealth growth, and it must reduce its resource extraction to levels that its productive base can maintain.

Economic Growth and Sustainable Development in Indonesia: An Assessment