The Size of an Air Shed – A Macroeconomic Stock Estimate

17 Pages Posted: 7 Jun 2017

See all articles by Dodo Jesuthason Thampapillai

Dodo Jesuthason Thampapillai

National University of Singapore (NUS) - Lee Kuan Yew School of Public Policy

Date Written: June 7, 2017

Abstract

This paper presents a simple method for estimating the size of environmental capital (KN) assets that are otherwise mistaken as infinite. An illustration is provided for Australia’s air shed. The method draws on the perpetual inventory method (PIM) used in macroeconomics for measuring the size of manufactured capital (KM) stock. Whilst the application of the PIM for measuring KM is based on net accumulation over time, with KN it involves net depreciation over time. The depreciation, however, can be negated by the resilience capabilities of KN assets based on their biophysical characteristics. Owing to sparse data, two proxy methods for estimating the resilience coefficient are developed. These proxies rely on emission targets and standards that have been discussed in Australia’s policy context.

Keywords: Environmental Capital Stock, Perpetual Inventory Method, National Income Accounts, Depreciation, Resilience

Suggested Citation

Thampapillai, Dodo Jesuthason, The Size of an Air Shed – A Macroeconomic Stock Estimate (June 7, 2017). Lee Kuan Yew School of Public Policy Research Paper No. 17-13. Available at SSRN: https://ssrn.com/abstract=2982244 or http://dx.doi.org/10.2139/ssrn.2982244

Dodo Jesuthason Thampapillai (Contact Author)

National University of Singapore (NUS) - Lee Kuan Yew School of Public Policy ( email )

Singapore 117591
Singapore
+6565164844 (Phone)

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