Total rents from natural resources: Framework and preliminary estimates for Switzerland

Rents and transfers linked to natural resources are an increasingly important part of national economies. However, concepts to comprehensively measure them remain limited, and empirical estimates are scarce. This paper proposes four concepts to organize and measure ‘total rents from natural resources’ including (1) traditional ‘resource rent’, (2) ‘resource gain’ defined as increases in resource value independent of changes in rights to resources, (3) ‘resource transfer’ through regulatory changes in resource rights, and (4) ‘resource externality’ or transfers through uncompensated damage to resources. Preliminary estimates for Switzerland for the period from 2016 to 2021 were calculated based on official statistics, private land price data, and existing studies of external costs. The annual estimates amount to CHF 78 billion for resource rent, CHF 167 billion for resource gain, CHF 23 billion for resource transfer, and CHF 31 billion for resource externality. The sum of CHF 298 billion corresponded to 42 % of the Swiss GDP in the same period, which was more than the combined tax revenues at the federal, cantonal and municipal levels. The rents from urban land accounted for 89 % of the total. Although these estimates are subject to considerable uncertainty, they show that the rents from natural resoures are very significant. These rents offer important potential for designing more efficient taxes and for achieving more equitable distributional outcomes. They deserve more attention in academic research and official statistics. • Empirical work on the wider range of rents from natural resources is scarce. • I propose concepts to organize and measure ‘total rents from natural resources’. • I compute preliminary estimates for Switzerland based on available datasets. • Resource-related rents and transfers are estimated at CHF 298 billion annually. • Total rents from natural resources deserve more attention in research and statistics.