Nature's Numbers: Expanding the National Economic Accounts to Include the Environment

by William D. Nordhaus (Editor), Edward C. Kokkelenberg (Editor), National Research Council

In order to really see the forest, what's the best way to count the trees? Understanding how the economy interacts with the environment has important implications for policy, regulatory, and business decisions. How should our national economic accounts recognize the increasing interest in and importance of the environment? Nature's Numbers responds to concerns about how the United States should make these measurements. The book recommends how to incorporate environmental and other non-market measures into the nation's income and product accounts. The panel explores alternative approaches to environmental accounting, including those used in other countries, and addresses thorny issues such as how to measure the stocks of natural resources and how to value non-market activities and assets. Specific applications to subsoil minerals, forests, and clean air show how the general principles can be applied. The analysis and insights provided in this book will be of interest to economists, policymakers, environmental advocates, economics faculty, businesses based on natural resources, and managers concerned with the role of the environment in our economic affairs.

262 pages, Hardcover

First published January 1, 1999

About the author

William Dawbney Nordhaus is an American economist and Sterling Professor of Economics at Yale University, best known for his work in economic modelling and climate change.

He is one of the laureates of the 2018 Nobel Memorial Prize in Economic Sciences. Nordhaus received the prize "for integrating climate change into long-run macroeconomic analysis".

He studied at Yale University and completed his PhD in 1967 at the Massachusetts Institute of Technology. He has been associated with Yale University since 1967 and a professor there since 1973. He has been a member of the Brookings Panel on Economic Activity since 1972, and from 1977 to 1979 he was an economic advisor to President Jimmy Carter’s administration.

William Nordhaus’ findings deal with interactions between society, the economy and climate change. In the mid-1990s, he created a quantitative model that describes the global interplay between the economy and the climate. Nordhaus’ model is used to examine the consequences of climate policy interventions, for example carbon taxes.