Comments on Ferreira and Moro (2011) 'Constructing genuine savings indicators for Ireland, 1995-2005'

Ferreira and Moro's article is an important attempt to improve and expand the 'rough' World Bank genuine savings estimates of Ireland, based upon available official statistical sources of Ireland. Their main findings are that Irish genuine savings estimates are smaller than the Bank's estimates and - this may come as a surprise - even negative for a number of years. These results are primarily driven by their much larger estimates of environmental degradation. Unfortunately, when going over their calculations, I have come to doubt the main outcomes of their study due to two issues: CO2 damage values are overestimated by a factor 13 as a mistake is made in converting damage costs expressed in dollars per ton carbon towards dollars per ton CO2. Second, the implied average SO2 damage values per ton that they use are much higher than found in the literature.