Integrated economic and environmental accounting for agriculture

This paper presents the methodological and conceptual aspects of a framework, which extends the conventional economic accounts for agriculture with environmental issues, valued in monetary terms. This leads to Economic and Environmental Accounts for Agriculture (EEAA). The EEAA are based on the conventional agricultural accounts and on existing tools for valuing non-market goods and services. The private costs and benefits of the sector are integrated with external “social” ones, i.e. commodity goods and services with non- commodity ones. Emphasis is put on those external costs and benefits that are already internalised as taxes and subsidies. As both positive and negative externalities are accounted for, the EEAA allow a better monitoring and evaluation of agriculture’s multifunctionality. They enable simulating impacts of policy instruments, such as a subsidy increase, not only on agricultural income, but also on societal welfare. It also becomes possible to appreciate the shares of different stakeholders (producers, public authorities, water agency, consumers, etc.) in the costs or benefits of the environmental goods and services provided by agriculture. The case of Belgium, with an intensive agriculture in a highly urbanised context is given.