Bioeconomic modelling – An application of environmentally adjusted economic accounts and the computable general equilibrium model

Abstract

Building on the current international discourse and United Nation's System of Environmental-Economic Accounting (SEEA) this study provides further empirical evidences on how failure to include natural capital resources in national accounting leads to erroneous calculation of macroeconomic estimates. The SEEA methodological framework for integrating natural capital into the System of National Accounts amplifies analytical power of computable general equilibrium (CGE) models and allows to investigate relationship between the economy and the environment. This paper integrates values of natural capital into Supply and Use Tables (SUTs) to illustrate depletion of forest due to natural disaster. It further applies CGE model to demonstrate economy-wide effects of a real event in which hurricane felled almost 80 thousands hectares of trees in Polish forests in 2017. The model results corresponds with the statistical data published after the mentioned event. Furthermore they align with findings of previous studies, which applied different methodical approach and show that without natural capital accounting the macroeconomic estimates provide misleading information about economic performance.