INTRODUCTION AND MAIN FINDINGS: THE CHANGING WEALTH OF NATIONS 17
accounts. Many of these services are already included in the value of agricultural land, but because they are only implicit, supporting what we value indirectly, their values are hidden. For example, the value of natural pollinators or groundwater is incorporated in the value of agricultural land. Fully accounting for the value of these ecosystem services would not add to the wealth of nations but would change the composition, for example by shifting part of the asset value from agricultural land to groundwater or forests. This information is useful for management of natural resources, because if policy makers are unaware that services critical to agriculture are provided by forests or wetlands, they may make decisions about forests that inadvertently reduce the productivity and value of agricultural land. But the land accounts—focusing on agricultural land, which is most important for developing countries and can be most readily measured—are not complete. We are missing ecosystem services associated with other types of land, notably residential and commercial land, but also other public land that is not under protected status.11 For these properties, the aesthetic amenity services provided by natural landscapes can be very important, especially in high-income countries where people are willing to pay high prices for lakeside or beachfront homes, for example. If the value of these ecosystem services were included in the natural capital accounts, it would likely increase the share of natural capital in total wealth, especially in high-income countries. The missing natural capital, treatment of ecosystem services, substitutability among different types of capital, and implications for the wealth accounts are discussed in more detail in the chapter annex. Filling the gaps in concepts, methods, and data, particularly for natural capital, constitutes an important agenda for improving the coverage and usefulness of wealth accounting.
Summing Up The work reported in this book offers lessons about how countries can develop sustainably. The analysis of wealth accounts over the decade from 1995 to 2005 shows development to be a process of building wealth. Furthermore, in this process, the composition of wealth shifts away from natural capital and toward produced capital and, increasingly, intangible capital. The important role of the changing composition of wealth in the development process points to the need for comprehensive wealth accounting. Intangible capital dominates the wealth accounts of all countries. Investing in human capital is important in this process, but building good institutions and governance is equally important because this provides the basis for more efficient use of, and higher economic returns to, all forms of capital. For developing countries, where natural capital is a large share of comprehensive wealth, sound management of natural capital to build wealth is critical.