Abstract:

This paper while examining some practical problems of natural resource accounting highlights the importance of decentralized method of accounting. The accounting principles for estimating green GDP are found to be different for the exhaustible resources from those for renewable environmental resources in the standard models of sustainable development. The physical and monetary accounts of environmental resources especially those of air and water can be region or project specific and the national accounts cannot be obtained by simply adding up the environmental changes at the regional level. Development of environmental accounts at the regional level or project level provides micro foundations for integrated environmental and economic accounting. Detailed case studies discussed provide empirical insights into the suggested methods of accounting. Key words: Natural resource accounting, sustainable development, shadow prices