Green accounting

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Introduction

Accounts environmentally adjusted has resulted from the necessity to modify the worldwide System of National Accounts (SNA) for calculating Gross Domestic Product (GDP), economic growth over time and other related aggregate measures in order to better reflect natural resources depletion and environmental degradation (O’Connor et al., 2000)[1]). That is why since 1980s, there were attempts to correct SNA to take full account of the depletion of natural resources and the deterioration of environmental functions. This led to accounts environmentally adjusted. This methodology can be complementary to Input-Output (I-O) analysis and Computable General Equilibrium (CGE) since it can serve to greening I-O tables with the aim to use them for economic assessment of environmental policy options.

A particular class of environmentally adjusted accounts is discussed below.

National Accounts Matrix including Environmental Accounts (NAMEA)

The basic principle of the NAMEA, also called Directly Expanded National Accounts, is to directly expand national accounts with environmental information in physical or monetary units, or both. This allows us tracing back the origin of the environmental pressures to industrial branches responsible for it as well as allocating pressures to final demand categories (e.g. to household consumption) using input–output analysis.

In the NAMEA, a link has been established between the national accounts and environmental statistics. By doing so, NAMEA reveals the interrelation between macro-indicators for the economy (net domestic product, net saving, external balance etc.) and the environment. The NAMEA can function as an instrument for all kinds of analysis. For example, the direct and indirect environmental effects of consumption or export of certain products can be demonstrated (CBS, 2006, p. 8[2]). An example is shown Table 1.



Table 1. The NAMEA matrix (shaded areas are physical accounts). CBS (2006).


Other regional economic accounting methods

Input-output matrix
Computable general equilibrium
Supply chain analysis


See also

Multifunctionality and Valuation in coastal zones: concepts, approaches, tools and case studies
Multifunctionality and Valuation in coastal zones: introduction


References

  1. O’Connor, M, Steurer, A. and Tamborra, M. 2000. Greening National Accounts, Environmental Valuation inEurope. Edited by: Spash, V.L. and Carter, C. Concerted Action funded by the European Commission DG-XII and coordinated by Cambridge Research for the Environment (CRE). http://www.clivespash.org/eve/PRB9-edu.pdf
  2. CBS (Centraal Bureau voor de Statistiek), 2006. Present status and future developments of the Dutch NAMEA. Paper for the international Workshop for Interactive Analysis on Economy and Environment. March 4th, Tokyo. Available on Internet : http://www.esri.go.jp/jp/archive/hou/hou020/hou20-2b-1.pdf


The main authors of this article are Mateo Cordier and Walter Hecq
Please note that others may also have edited the contents of this article.

Citation: Mateo Cordier; Walter Hecq; (2019): Green accounting. Available from http://www.coastalwiki.org/wiki/Green_accounting [accessed on 17-11-2019]