Modelling and accounting work in national and environmental accounts

TLDR: In this paper, the authors discuss some issues in relation with the interim version of the SEEA and raise some questions as to the meaning of the results, based on partial and constrained modelling, and their inclusion in an accounting framework.

Abstract: Modelling plays a limited role in the central framework accounts of the System of National Accounts (SNA), which are based essentially on observations. By contrast, satellite environmental accounts in money terms, with the more ambitious objectives advanced in the United Nations System of integrated Environmental and Economic Accounting (SEEA), seem largely a modelling construct. Modelling is used in a broad sense, covering valuation relying on economic theory. Such an approach requires careful explanation of what types of flows and stocks are intended to be measured, what seems to be measurable, what is actually measured (or measurable) and what is the meaning of the aggregates that are proposed. This chapter discusses some issues in relation with the interim version of the SEEA. They include mainly the difficulty raised by the advocated combination of exchange values (market prices) and use values (based on analysis of the consumer surplus) in the welfare approach. Ex post modelling used for the estimation of the hypothetical maintenance costs also raises some questions as to the meaning of the results, based on partial and constrained modelling, and their inclusion in an accounting framework.