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Using Ecosystem Accounting to Integrate the Environment in Measures of Multifactor Productivity

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  • Carl Obst

Abstract

There is increasing recognition of the relevance of integrating environmental considerations within standard macroeconomic measures including GDP and national wealth and, by extension to measures of multifactor productivity (MFP). A range of approaches to measuring environmentally adjusted MFP (EAMFP) have been developed over the past decade which variously adjust the measure of output or recognize explicitly natural capital inputs. This article summarizes the main approaches to EAMFP and discusses their merits from a national accounting principles perspective, identifying some concerns on potential double counting of environmental contributions and effects. It then considers the potential of ecosystem accounting as described in the System of Environmental-Economic Accounting (SEEA) Ecosystem Accounting to offer an alternative framing for integrating the environment into economy-wide MFP measures.

Suggested Citation

  • Carl Obst, 2024. "Using Ecosystem Accounting to Integrate the Environment in Measures of Multifactor Productivity," International Productivity Monitor, Centre for the Study of Living Standards, vol. 47, pages 87-108, Fall.
    • Handle: RePEc:sls:ipmsls:v:47:y:2024:5
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    File URL: https://www.csls.ca/ipm/47/Obst_final.pdf
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    References listed on IDEAS

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    1. Paul Schreyer & C. Obst, 2015. "Towards Complete Balance Sheets in the National Accounts: The case of Mineral and Energy Resources," OECD Green Growth Papers 2015/2, OECD Publishing.
    2. Syed, Arif & Grafton, R. Quentin & Kalirajan, Kaliappa & Parham, Dean, 2015. "Multifactor productivity growth and the Australian mining sector," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 59(4), October.
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    4. Cárdenas Rodríguez, Miguel & Haščič, Ivan & Souchier, Martin, 2018. "Environmentally Adjusted Multifactor Productivity: Methodology and Empirical Results for OECD and G20 Countries," Ecological Economics, Elsevier, vol. 153(C), pages 147-160.
    5. United Nations, 2014. "System of Environmental-Economic Accounting 2012," World Bank Publications - Books, The World Bank Group, number 23959, April.
    6. Eli P. Fenichel & Joshua K. Abbott, 2014. "Natural Capital: From Metaphor to Measurement," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 1(1), pages 1-27.
    7. Edens, Bram & Maes, Joachim & Hein, Lars & Obst, Carl & Siikamaki, Juha & Schenau, Sjoerd & Javorsek, Marko & Chow, Julian & Chan, Jessica Ying & Steurer, Anton & Alfieri, Alessandra, 2022. "Establishing the SEEA Ecosystem Accounting as a global standard," Ecosystem Services, Elsevier, vol. 54(C).
    8. Miguel Cárdenas Rodríguez & Florian Mante & Ivan Haščič & Adelaida Rojas Lleras, 2023. "Environmentally adjusted multifactor productivity: Accounting for renewable natural resources and ecosystem services," OECD Green Growth Papers 2023/01, OECD Publishing.
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