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Mother Pelican
A Journal of Solidarity and Sustainability
Vol. 14, No. 6, June 2018
Luis T. Gutiérrez, Editor
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Relevance of Global Multi Regional Input Output Databases
for Global Environmental Policy: Experiences with EXIOBASE 3
Arnold Tukker, Richard Wood, and Stefan Giljum
This article was originally published by
Journal of Industrial Ecology, 4 May 2018
under a Creative Commons License
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In the era of globalization, supply chains are increasingly organized at the international
level, thus disconnecting the location of production from final consumption. Consumption
therefore has become a major, geographically distant driver of various local environmental
and social impacts in countries,
In a world that is ever more connected via trade, GMRIOs are crucial instruments to
understand not only how value chains drive the creation of added value, but also emissions,
resource extraction, and waste production.
where raw materials are extracted or products manufactured. The investigation of the
various “tele-connections” between local consumption and global impacts has developed
into an important field of research within industrial ecology, with special issues,
including in this Journal (see Hubacek et al. 2016), being dedicated to this topic.
The need to provide indicators that take these international connections into account
and allow assessment of the global impact of consumption from a “footprint” perspective
has triggered the development of a number of methodological approaches and databases.
The approach most widely applied for consumption-based, that is, footprint-type, assessments
at the country level is (global) multiregional input-output (GMRIO) analysis (Tukker
and Dietzenbacher 2013). MRIO models link domestic economic structures of a large number of countries with
bilateral trade data on the product level and thus provide a detailed representation
of monetary flows in the global economy. Extending the core MRIO model with environmental
data allows quantifying the amount or impacts of natural resources or different types
of pollutions embodied in internationally traded products and in final consumption.
This special issue introduces a new MRIO database (i.e., EXIOBASE 3), which was developed
in the European Union Seventh Framework Program project DESIRE (Development of a System
of Indicators for a Resource efficient Europe). EXIOBASE 3 allows assessment of the
global environmental consequences associated with consumption of European and other
countries and features times-series data at a high level of product and industry detail
as well as providing a physical representation of the world economy.
The special issue contains four clusters of papers. These range from presenting methodological
details of the construction of the various modules of EXIOBASE 3 via empirical assessments
generated with this new database to deriving general conclusions about pathways of
developing MRIO databases in the future. This special issue is built up as follows.
For the first part, the editors invited some crucial international institutional players
in the field to provide their views on the relevance of work on input-output analysis
for policy making. Contributions were received by Nori Yamano and Colin Webb who work
on the OECD's Inter-Country Input-Output tables, and José Rueda-Cantuche, Maaike Bouwmeester,
and Isabelle Remond Tiedrez who reflect on the joint work of Eurostat and the European
Union's Joint Research Centre on European input-output tables.
In the second part, the special issue discusses the state of the art of the most commonly
used MRIO databases and evaluates their strengths and limitations (Tukker et al. 2018a). It also presents the construction of EXIOBASE 3 that aimed at overcoming such limitations.
The paper by Stadler and colleagues (2018) provides a detailed description of the compilation process of EXIOBASE 3. It provides
details about refinement methods for both the monetary MRIO part as well as the environmental
satellite accounts and compares the characteristics of EXIOBASE 3 with previous versions
of the database. Furthermore, EXIOBASE 3 is the first GMRIO that contains a comprehensive
accounting of physical flows in the economy (using principles of physical mass balance).
The compilation of this part of EXIOBASE 3 is discussed in the paper of Merciai and
Schmidt (2017).
The third part of the special issue focuses on various empirical applications. Wood
and colleagues (2018) apply the new EXIOBASE 3 database to investigate the growth in environmental pressures
in various countries in a time series from 1995 to 2011, discussing the role of international
trade in contributing to environmental leakage. The contribution by Steinmann and
colleagues (2017) turns to the issue of policy relevance of indicator sets on resource use and resource
efficiency. They find that carbon, land, water, and material footprints cover almost
60% of the variance in product rankings among environmental indicators and that extension
by five impact-oriented indicators increases the coverage to 95%. Moran and colleagues
(2017) analyze so-called feedback emissions—in considering how intertwined the global economy
has become, they look at how much of the pollution embodied in exports of a country
is embodied back in the imports of that country, after traveling through global value
chains. Their conclusion is that apart from some big economies such as China, such
feedbacks are very limited, and there are thus potentially simple ways to link GMRIO
models to individual country data not adequately represented in GMRIO databases. The
paper concludes with a discussion on the implications for optimizing indicator sets
for environmental policy making. Next, Usubiaga and colleagues (2017) use EXIOBASE 3 to estimate reduction of environmental footprints by reductions of
the amount of food waste. Finally, Wood and colleagues (2017) propose a framework that demonstrates the usefulness of MRIO databases such as EXIOBASE
3 in assessing the impact of policy measures—both geospatially, and in terms of supply-chain
impact. Such approaches can give quick estimates based on exploiting EXIOBASE V3 to
give the potential savings and rebounds of a technical implementation of a policy
measure.
In the fourth and final part of this special issue, Tukker and colleagues (2018b) look to the future. They discuss options to make GMRIO databases and derived consumption-based
indicators more robust and authoritative. The paper proposes a multistep approach,
suggesting that, in the short term, so-called Single country National Accounts Consistent
(SNAC) approaches would suffice. In the medium term, harmonized satellite data for
a range of environmental categories could be developed and the Organization for Economic
Cooperation and Development (OECD) MRIO data set used in combination with detailing
procedures to increase the sector detail. For the long term, the paper argues for
an internationally harmonized effort to establish a common, global MRIO framework,
ensuring consistency in sector and product classifications and resolving the asymmetries
of bilateral trade.
This special issue has also been augmented by two book reviews of recent publications
on MRIO: Environmental and economic impacts of decarbonization: Input-output studies on the
consequences of the 2015 Paris Agreement edited by Dejuán and colleagues (Tukker 2018a) and Techniques for evaluating the differences in multiregional input-output databases:
A comparative evaluation of CO2 consumption-based accounts calculated using Eora, GTAP and WIOD by Owen (Tukker 2018b).
As argued in the columns of Yamano (2018) and Rueda-Cantuche and colleagues (2018) in a world that is ever more connected via trade, GMRIOs are crucial instruments
to understand not only how value chains drive the creation of added value, but also
emissions, resource extraction, and waste production. Creating such GMRIOs is a complicated
affair. In this, scientists from the field of industrial ecology, input-output analysis,
and practitioners from national statistical offices and related international organizations
increasingly collaborate. As reflected by this special issue, and a recent one on
Global Virtual Laboratories in Economic Systems Research (Lenzen et al. 2017), this is a promising way of working toward a formalized operational global accounting
system that can be a major support of monitoring progress toward the Sustainable Development
Goals.
Funding Information
Most papers in this Special Issue were written in the context of the Development of
a System of Indicators for a Resource Efficient Europe (DESIRE), a Collaborative project
under the Seventh Framework Program of the European Union, Grant Agreement No.: 308552.
References
Hubacek, K., K. Feng, B. Chen, and S. Kagawa. 2016. Linking local consumption to global impacts. Journal of Industrial Ecology 20(3): 382–386.
Lenzen, M., A. Geschke, M. A. Rahman, M. Daaniyall, Y. Xiao, J. Fry, R. Reyes, E. Dietzenbacher, S. Inomata, and K. Kanemoto. 2017. The Global MRIO Lab—Charting the world economy. Economic Systems Research 29: 158–186.
Merciai, S. and J. Schmidt. 2017. Methodology for the construction of global multi-regional hybrid supply and use tables
for the EXIOBASE v3 database. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12713.
Moran, D., R. Wood, and J. F. D. Rodrigues. 2017. A note on the magnitude of the feedback effect in environmentally extended multi-region
input-output tables. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12658.
Rueda-Cantuche, J. M., I. Remond-Tiedrez, and M.C. Bouwmeester. 2018. Institutionalisation of inter-country input-output tables: Working towards harmonisation
and standardisation. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12761.
Stadler, K., R. Wood, T. Bulavskaya, C.-J. Södersten, M. Simas, S. Schmidt, A. Usubiaga, et al. 2018. EXIOBASE 3—Developing a time series of detailed environmentally extended multi-regional
input-output tables. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12715.
Steinmann, Z., A. Schipper, K. Stadler, R. Wood, A. De Koning, A. Tukker, and M. A. J. Huijbregts. 2017. Headline environmental indicators revisited with the global multi-regional input-output
database EXIOBASE. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12694.
Tukker, A. and E. Dietzenbacher. 2013. Global multiregional input-output frameworks: An introduction and outlook. Economic Systems Research 25(1): 1–19.
Tukker, A. 2018a. Book review of Environmental and economic impacts of decarbonization: Input-output studies on the
consequences of the 2015 Paris Agreement, edited by Ó. Dejuán, Manfred Lenzen, and María-Ángeles Cadarso. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12768.
Tukker, A. 2018b. Book review of Techniques for evaluating the differences in multiregional input-output databases:
A comparative evaluation of CO2 consumption-based accounts calculated using Eora, GTAP and WIOD by Anne Owen. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12726.
Tukker, A., S. Giljum, and R. Wood. 2018a. Recent progress in assessment of resource efficiency and environmental impacts embodied
in trade—An introduction to this special issue. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12736.
Tukker, A., A. de Koning, A. Owen, S. Lutter, M. Bruckner, S. Giljum, K. Stadler, and R. Wood. 2018b. Towards robust, authoritative assessments of impacts embodied in trade. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12716.
Usubiaga, A., I. Butnar, and P. Schepelmann. 2017. Wasting food, wasting resources: Potential environmental savings through food waste
reductions. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12695.
Wood, R., D. Moran, D. Ivanova, K. Steen-Olsen, A. Tisserand, and E. Hertwich. 2017. Prioritizing consumption-based carbon policies based on the evaluation of mitigation
potential using input-output methods. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12702.
Wood, R., K. Stadler, M. Simas, T. Bulavskaya, S. Giljum, S. Lutter, and A. Tukker. 2018. Growth in environmental footprints and environmental impacts embodied in trade: Resource
efficiency indicators from EXIOBASE 3. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12735.
Yamano, N. 2018. Future development of the OECD Inter-Country Input-Output (ICIO) Database for Global
Value Chain (GVC) and environmental analyses. Journal of Industrial Ecology. https://doi.org/10.1111/jiec.12758.
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"We are not living an era of change but a change of era."
Pope Francis, 10 November 2015
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