Provides strategies and approaches for integrating natural capital into environmental statistics.

While the importance of natural resources and the contributions of the environment to welfare are apparent, traditional national income and wealth accounting practices do not measure or value environmental public goods. This volume examines the conceptual and empirical basis for integrating natural capital—forests, oceans, and air—into the economic and environmental statistics that inform public policy. It offers innovative approaches to valuing nonmarket environmental goods and services, including strategies for capturing heterogeneity in measurement across types of capital, geography, and individuals.

The chapters focus on measuring productivity with adjustments for pollution damage, developing a microdata infrastructure to advance our understanding of the distribution of environmental amenities and hazards, and estimating long-run sustainable development indicators. Case studies consider coastal assets, forests, and marine ecosystems, and develop strategies for implementing specific environmental-economic accounts such as environmental activity accounts and natural capital accounts for forests and the marine economy. As national income accounting standards are updated to incorporate expanded guidance on issues related to natural capital, this timely book will help inform decisions on the measurement and treatment of climate, air, water, and other public goods.

Nicholas Z. Muller is the Lester and Judith Lave Professor of Economics, Engineering, and Public Policy in the Tepper School of Business and the Department of Engineering and Public Policy at Carnegie Mellon University and a research associate of the NBER. Eli P. Fenichel is the Knobloch Family Professor of Natural Resource Economics at the Yale School of the Environment. He is a former assistant director for natural resource economics and accounting at the White House Office of Science and Technology Policy. Mary Bohman retired in 2023 after serving as acting director and deputy director of the US Bureau of Economic Analysis. Previously she held leadership positions in economic research in the US Department of Agriculture and is a Fellow of the Agricultural & Applied Economics Association.