Can we use non-market valuation techniques in green national accounting applied to forests?

Abstract

Theory on green national accounting has been an important research topic in recent years. Nevertheless, little effort has been put into the practical measurement of exchange values for environmental goods and services to be integrated with commercial ones in applied green national accounting. While market values are measured in national accounts using market exchange prices times quantity, environmental valuation techniques yield consumer surplus or Hicksian variations, so that direct aggregation is not possible. For free-access public recreation in forests we propose to simulate the whole market (demand, costs and competitive environment). We obtain an interval, depending on the competitive environment assumed, but the values obtained are (simulated) exchange values that can be aggregated to commercial values. We also discuss the different options available to obtain an interval for the exchange value for private environmental recreation and other amenity values consumed by the land owner. The methodology is illustrated with two forest applications in Spain.