ABSTRACT

Several concerns typically drive the development of forest accounts. First is the desire to account for forest depletion—that is, for timber harvesting that outpaces the natural growth of the forest. The revenue from the sale of timber shows up in the national accounts as income. If, however, we cut down the forest faster than it can regenerate, we are, in effect, consuming an asset rather than consuming only its output. The excess above sustainable yield is depletion of the forest, which should be handled in some way akin to the depreciation of manufactured capital. This issue applies not only to timber, but to all renewable goods and services of the forest, including other plant products, animals, fuel-wood, and so on.