Advances in Measuring Sustainable Development
7. Deforestation: accounting for a multiple-use resource INTRODUCTION The primary goal of this chapter is to extend the savings analysis to a domain that seems both particularly topical and important, the depletion of forests in the developing world. Green national accounting can inform this debate in a number of ways. Firstly, there is the provision of a consistent and coherent framework for analysing detailed and diverse data describing the net welfare cost of clearing forested land. Secondly, given the focus of these accounts on the better measurement of income and wealth, they are ideally suited to evaluating whether the switch of land use from forest to agriculture is actually wealth increasing (or ‘sustainable’). Central to this is an expansion of the asset boundary to account explicitly for changes in land use, that is, where land is an asset that has a distinct (social) value depending on the use to which it is put (Hartwick, 1992, 1993; Vincent, 1999a). A number of empirical studies have examined forestry and the national accounts (see, Vincent and Hartwick, 1997, for a comprehensive survey). Many of these studies, however, have focused exclusively on accounting for the net accumulation of timber that arises when forested land is cleared. The basic model underlying these calculations views the exploitation of primary forest as akin to a ‘timber mine’ where ‘reserves’ can be augmented via natural growth (Nordhaus and Kokkelenberg, 1999). Net accumulation is deﬁned as net harvest (or net growth) valued at the unit rent or stumpage...
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