The role of environmental protection expenditures in integrated economic?environmental accounting: tuning theoretical perspectives and statistical realities

Abstract

This paper presents an overview of the role of environmental protection expenditures in National Accounting systems. The main objective is to assess the extent to which an adjusted System of National Accounts (SNA) provides a valid and reliable data source for the empirical estimation of economic welfare concepts based on this system's key indicator, i.e. Gross Domestic Product (GDP). Such an assessment is crucial to the role that integrated indicators of economic and environmental change are foreseen to play in informing, evaluating and changing policy. The paper shows that practical constraints reinforce the limits of the imposed theoretical framework, seriously undermining the usefulness of previously proposed adjustment mechanisms and corresponding interpretations of the GDP.