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OECD Green Growth Papers

The OECD Green Growth Strategy, launched in May 2011, provides concrete recommendations and measurement tools to support countries’ efforts to achieve economic growth and development, while at the same time ensure that natural assets continue to provide the ecosystems services on which our well-being relies. The strategy proposes a flexible policy framework that can be tailored to different country circumstances and stages of development. OECD Green Growth Papers complement the OECD Green Growth Studies series, and aim to stimulate discussion and analysis on specific topics and obtain feedback from interested audiences.

English

Environmentally adjusted multifactor productivity

Accounting for renewable natural resources and ecosystem services

Multifactor productivity is a comprehensive measure of productivity where the underlying production function accounts for multiple factor inputs, traditionally labour and produced capital. While single-factor productivity is intuitively simple, such measure offers a biased picture of the economy because it attributes all variation in output growth to a single factor input (e.g. consumption of fossil fuels or material resources) while the role of other factors is ignored. Multifactor productivity aims at addressing this shortcoming, and as such it is a valuable component of the OECD set of Green Growth headline indicators. This paper presents further progress in measuring the EAMFP and related growth accounting indicators in 52 countries for 1996-2018. An important novelty is the inclusion of renewable natural resources such as land, timber and fisheries, and ecosystem services such as coastal and watershed protection. Exploratory results on accounting for renewable energy resources are also included.

English

Keywords: pollution, costs, indicators, income, greenhouse gases, environmental accounting, prices, forest, natural capital, land, exhaustible resources, minerals, multifactor productivity, renewable resources, air pollution, production, fossil fuels, ecosystem services, renewable energy
JEL: Q52: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Pollution Control Adoption and Costs; Distributional Effects; Employment Effects; D24: Microeconomics / Production and Organizations / Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity; O47: Economic Development, Innovation, Technological Change, and Growth / Economic Growth and Aggregate Productivity / Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence; Q56: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth; Q3: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Nonrenewable Resources and Conservation; O44: Economic Development, Innovation, Technological Change, and Growth / Economic Growth and Aggregate Productivity / Environment and Growth; Q2: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Renewable Resources and Conservation; Q53: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics / Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling; Q5: Agricultural and Natural Resource Economics; Environmental and Ecological Economics / Environmental Economics
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