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Environmental Accounting. The Potential of an Input-output Approach


  • Kurt Kratena


International institutions concerned with the concepts of national accounts (the UN and the Statistical Office of the EU) as well as the statistical offices of many industrialized and developing countries have begun to construct a system of ecological national accounts. In general two main lines can be discerned among the many theoretical proposals regarding the national level. One group of researchers explicitly attempts to adjust the GDP in the sense of an ecological social product, thus abandoning the idea of descriptive statistics. Another group wants to link a detailed system of information on the environment with the traditional accounting system. Austria has chosen the second option: the "System of National Accounts" (SNA) is being enlarged into a comprehensive economic/ecological reporting system. An input-output system extended by environmental effects, for example, can be used to calculate, given the technology and economic structure of a certain year, the "feasible" GDP which is compatible with a certain environmental goal (such as the "Toronto target" with regard to CO2 emissions, which requires a reduction by 20 percent relative to the 1988 level). This "feasible" GDP can only rise if structural and technical change are sufficient to break the link between the volume of emissions and economic development. If this approach is applied to the development of Austria's CO2 emissions between 1983 and 1992, the following picture emerges: between these two years, GDP rose by 2.7 percent, CO2 emissions by 0.8 percent, and the "feasible" GDP by 1.8 percent. Thus, the link has been broken, but attainment of the Toronto target would have required an even sharper break. The indicator "feasible" GDP is not a good substitute for an "ecological social product", but is suitable as an indicator for the evaluation of the effects of environmental measures (e.g., CO2/energy tax).

Suggested Citation

  • Kurt Kratena, 1995. "Environmental Accounting. The Potential of an Input-output Approach," WIFO Monatsberichte (monthly reports), WIFO, vol. 68(11), pages 719-726, November.
  • Handle: RePEc:wfo:monber:y:1995:i:11:p:719-726

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