A primer on the economics of natural capital and its relevance to deep-sea exploitation and conservation

Marine science is now moving quickly to reveal the biophysical, geochemical, and ecological properties of the deep sea. As this understanding grows, deep-sea resources will begin to be exploited more extensively, embodying the hopes of many for a Blue Economy. Institutions to govern this exploitation are only just finding their strides or even just emerging, but there are many cases already of resource overuse and degradation, including overfishing and the impacts beginning to be wrought by a changing climate. Progress towards the sustainable development of the deep sea requires useful indicators that point to changes in human well-being as the deep sea is exploited, such as measures of inclusive wealth. Accounting prices for the natural capital of the deep sea would be useful indicators, and several examples are explored to illustrate current understanding and research gaps. A future economic research agenda would involve refining estimates of accounting prices for the most important types of deep-sea natural capital, locating these within linked classifications of ecosystem services and natural capital, and the design and implementation of a system of economic and environmental accounts for the deep sea comprising the high seas, which lies beyond the purview of individual states.

Sustainability accounting and green accounting

Theoretical issues arising in maximin and utilitarian programs are considered in order to shed light on the merits of various concepts of income and types of environmental accounting as guides for environmental policy. The accounting prices for sustaining an economy obey Hartwick's rule but are inconsistent with the principles of national accounting. Moreover, they would be formidably difficult to calculate. Green net national product is an approximate index of welfare in a utilitarian economy which maximises future discounted utility flows. These conclusions hold even if underlying conditions are non-autonomous.JEL Codes: Q3, E2