In addition to the size of the forests, the diversity of tree species is also worth mentioning, since five of the ten countries with the most tree species are in the B-rated category (FAO and UNEP, 2020). The FAO (2014) discusses the importance of forest genetic resources in developing economies and economies in transition in the context of their “actual or potential economic, environmental, Given the direct productive capabilities of forests and their indirect socioeconomic benefits, investing into this renewable resource is an economically worthwhile decision. We see support for this in the underlying data. Figure 7a shows the average annual percentage increase in planted forest areas between 2009 and 2020. A planted forest is a "[f]orest predominantly composed of trees established through planting and/or deliberate seeding" (FAO, 2020) and is to be distinguished from natural regrowth. The fact that countries, where agriculture, forestry and fishing constitute a larger share of GDP value-added largely coincide with the countries with the most planted forest expansion, renders luxury investment explanation unlikely. This is further supported by Table 5, Appendix, which decomposes the negative coefficient by rating category. The same investment into forests lowers yields significantly more in B-rated countries.

Table 6, Appendix, shows disaggregated results where forest capital is divided into timber and non-timber forests. Interestingly, the latter type mainly drives the yield lowering effect of forests. Identifying whether this reflects tourism revenues based on non-timber forest capital or in fact captures the hard-to-quantify benefits of its external effects is left for future studies.

# **4.5 Agriculture**

The agricultural sector in the broad sense is the largest employer in the world and faces a monumental task: Feeding 10 billion people in 2050 (FAO, 2018). Ensuring that agricultural land does not become a non-renewable resource due to land degradation is of paramount importance to the economy of a nation and the world.

This wealth category is divided into cropland, which represents the value of primary crops of cereals, fruits, vegetables for human consumption, and pastureland, which is mainly concerned with indigenous livestock production for meat, milk and other products (World Bank, 2018). The value of land is also partly derived from "water supply, soil fertility and pollination services" (Lange et al., 2018). FAOSTAT data shows that agricultural land area has been steadily growing for B-rated countries (annual growth rate of 0.14% or total growth rate of 1.32% between 2009–2018, excluding Italy and Spain) and shrinking for A-rated countries (annual growth rate of -0.15% or total growth rate of -1.29%). Given that agriculture, forestry and fishing constitute a larger share of GDP value-added in B-rated countries, this discrepancy is not entirely unexpected.

At the same time, both cropland and pastureland deteriorate the environment. The IPBES (2019) estimates that “[a]pproximately 25 per cent of the globe’s greenhouse gas emissions come from land clearing, crop production and fertilization, with animal-based food contributing 75 per cent of that.” Livestock has a disproportionately strong social and environmental impact compared to its economic relevance, as it is the main factor for deforestation and accounts for 18 percent of greenhouse gas emissions (Steinfeld et al., 2006). The FAO cites soil loss and degradation as threats to agriculture itself (FAO, 2018). IPBES (2019) estimates that 23 percent of the world’s 20