Applications of environmental accounting and the new household economics: new technical economic issues with a common theme in forestry

This paper reviews environmental accounting and the new household economics (NHE) as important new developments for forest economics, and particularly for assessing non-market and non-timber forest products. The concept of adjusting the national accounts for forest depletion has received a lot of attention, but forest-based household services, like outdoor recreation in developed countries or fuelwood in developing countries, may have greater impacts on the national accounts. NHE is an econometric approach for valuing forest-related household services like these. In general, the NHE allows complete estimates based on revealed preferences for the production, supply and demand of goods and services that some households produce and consume internally. Complete estimates are critical in economies where household services dominate market production and consumption, and where market observations alone would be partial and would misguide policy decisions. Therefore, household services are the important area of application for both environmental accounting and NHE. Applications of each hold special promise for our understanding of the forestry activities of subsistence households in developing countries.