Assessing the economic damage from Indonesian fires and the haze : a conceptual note

A haze from forest fires in Indonesia affected not only that country, but also most of Malaysia, Singapore and Southern Thailand, for three months in 1997. Studies estimating the cost of the haze to the affected economies have since appeared. This note shows that "typical" empirical estimates of costs (benefits) related to the haze often contain elements of transfers between groups in an economy and can be misleading when the intention is to measure the net losses or gains to the economy as a whole. (Singapore Econ Rev/DÜI)