Abstract
In a paper titled “Wealth Accounting, Exhaustible Resources and Social Welfare”, Hamilton and Ruta (Environ Resour Econ 42(1):53–64, 2009) derived accounting price for an exhaustible resource in Eq. (18), in the so-called “El Serafy economy” (El Serafy in Environmental accounting for sustainable development. The World Bank, Washington, 1989). However, the result is not plausible since they improperly replace constant extraction in the value of the resource stock (Eq. 17) with current resource stock divided by reserve life in their derivation. In the short comment, I show that the accounting price should be the same as the unit “user cost” defined by El Serafy (Environmental accounting for sustainable development. The World Bank, Washington, 1989).
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References
El Serafy S (1989) The proper calculation of income from depletable natural resources. In: Ahmad Y, El Serafy S (eds) Environmental accounting for sustainable development. The World Bank, Washington
Hamilton K, Atkinson G (2013) Resource discoveries, learning, and national income accounting. In: Policy research working paper no. WPS 6505, World Bank, Washington
Hamilton K, Ruta G (2009) Wealth accounting, exhaustible resources and social welfare. Environ Resour Econ 42(1):53–64. doi:10.1007/s10640-008-9235-7
World Bank (2011) The changing wealth of nations. Washington
Acknowledgments
I am grateful for constructive comments by three anonymous referees. The comment was motivated in a meeting of a project supported by National Natural Science Foundation of China (No. 71333010).
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Wei, T. Accounting Price of an Exhaustible Resource: A Comment. Environ Resource Econ 60, 579–581 (2015). https://doi.org/10.1007/s10640-014-9780-1
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DOI: https://doi.org/10.1007/s10640-014-9780-1