Consumption-based greenhouse gas emissions accounting with capital stock change highlights dynamics of fast-developing countries

The degree of population aging and carbon emissions: Analysis of mediation effect and multi-scenario simulation

The continuous deepening of aging has posed new challenges for global sustainable development. Measuring the impact of population aging on carbon emissions is crucial for the next stage of climate governance. However, the structural changes in social production and consumption make it difficult to evaluate the impact effects. Therefore, this study constructed a bidirectional fixed Space Durbin Model to explore the mediating pathway of aging's impact on carbon emissions. Furthermore, we have established high-precision prediction models to simulate the evolution trajectory of carbon emissions under multi-factor driving scenarios. The main findings are as follows: (1) The process of carbon emission reduction due to population aging has significant energy hindrance effect and industrial structure effect, while the process of carbon growth is constrained by the consumption enhancement effect, technology progress effect and labor participation effect. (2) The moderating effects of energy consumption and technological innovation on carbon emissions under the aging process are 10.74% and 10.24%, respectively, while the moderating effects of industrial structure and labor force participation are relatively weak. (3) The goodness of fit of the MNGM-ARIMA and MNGM-BPNN models is over 97%. Carbon emissions in the high aging regions show a decreasing trend in all scenarios except the energy consumption-driven scenario, while in the medium and low aging regions decrease slowly only in the R&D- and labor supply-driven scenarios. This study advocates developing heterogeneous emission reduction measures based on the degree of aging, accelerating supply side upgrading, and increasing the proportion of green consumption.

Deep mitigation for trade-embodied carbon emissions among the Belt and Road Initiative countries

The frequent trade within and beyond the Belt and Road Initiative (BRI) has prospered the economy but has also expanded carbon emissions. Here, through a multi-regional environmental input-output analysis framework, we explore the patterns and inter-sectoral linkage of trade-embodied carbon emissions among BRI countries during 2015-2019. Then, a dynamic data envelopment analysis model considering carbon inequality as a non-discretionary input is constructed to assess the carbon emission efficiency of the identified key sector. We find that trade-embodied carbon emissions in the BRI steadily increased during 2015-2019. The manufacturing sector was identified as the key sector, exhibiting an overall efficiency of 0.6268 on average, with significant efficiency disparities. Moreover, we validate the positive role of efficiency enhancement in carbon emission mitigation, as well as the negative moderating effect of carbon inequality. Overall, this study provides optimal collaboration and initiatives to mitigate trade-embodied carbon emissions among BRI countries deeply.

Material and Carbon Footprints of Machinery Capital

Machinery and equipment, integral as technology-specific capital goods, play a dual role in climate change: it acts as both a mitigator and an exacerbator due to its carbon-intensive life cycle. Despite their importance, current climate mitigation analyses often overlook these items, leaving a gap in comprehensive analyses of their material stock and environmental impacts. To address this, our research integrates input-output analysis (IOA) with dynamic material flow analysis (d-MFA) to assess the carbon and material footprints of machinery. It finds that in 2019, machinery production required 30% of global metal production and 8% of global carbon emissions. Between 2000 and 2019, the metal footprint of the stock of machinery grew twice as fast as the economy. To illustrate the global implications and scale, we spotlight key countries. China's rise in machinery material stock is noteworthy, surpassing the United States in 2008 in total amount and achieving half of the US per capita level by 2019. Our study also contrasts economic depreciation─a value-centric metric─with the tangible lifespan of machinery, revealing how much the physical size of the capital stock exceeds its book values. As physical machinery stocks saturate, new machinery can increasingly be built from metals recycled from retired machinery.

Towards a low-carbon future for China's power supply chain: Critical sectors identification and scenario analysis

The power sector is a significant contributor to global carbon emissions and has received widespread attention from scholars; however, the path to achieving supply chain-wide carbon reductions in China from a provincial perspective remains unclear. This study combined multi-regional input-output and betweenness-based methods to identify the critical upstream sectors that indirectly drive large amounts of carbon emissions through power supply chains. The point source data of coal-fired units were collected to ensure the accuracy of the disaggregated input-output table. In addition, a scenario analysis was conducted to examine the effects of different electricity policy combinations on supply chain-wide emissions during the 14th Five-Year Plan (FYP). Our findings indicate that the embodied carbon intensity of the coal-fired power sector in Northwest China is among the highest in the country, ranging from 36.39 to 82.10 tons/10000 CNY. Therefore, the shift of the power sector to Western China during the 14th FYP will partially offset the positive emission reduction effect of the structural transformation of the power system. To achieve a low-carbon power supply chain, it is necessary to improve the production efficiency of critical transmission sectors and the low-carbon technology levels of major emitting sectors. Our results provide valuable insights for provincial governments to plan low-carbon transformation paths for the power sector.

The legacy environmental footprints of manufactured capital

The foundations of today's societies are provided by manufactured capital accumulation driven by investment decisions through time. Reconceiving how the manufactured assets are harnessed in the production-consumption system is at the heart of the paradigm shifts necessary for long-term sustainability. Our research integrates 50 years of economic and environmental data to provide the global legacy environmental footprint (LEF) and unveil the historical material extractions, greenhouse gas emissions, and health impacts accrued in today's manufactured capital. We show that between 1995 and 2019, global LEF growth outpaced GDP and population growth, and the current high level of national capital stocks has been heavily relying on global supply chains in metals. The LEF shows a larger or growing gap between developed economies (DEs) and less-developed economies (LDEs) while economic returns from global asset supply chains disproportionately flow to DEs, resulting in a double burden for LDEs. Our results show that ensuring best practice in asset production while prioritizing well-being outcomes is essential in addressing global inequalities and protecting the environment. Achieving this requires a paradigm shift in sustainability science and policy, as well as in green finance decision-making, to move beyond the focus on the resource use and emissions of daily operations of the assets and instead take into account the long-term environmental footprints of capital accumulation.

Allocating capital-associated CO2 emissions along the full lifespan of capital investments helps diffuse emission responsibility

Capital assets such as machinery and infrastructure contribute substantially to CO₂ emissions over their lifetime. Unique features of capital assets such as their long durability complicate the assignment of capital-associated CO₂ emissions to final beneficiaries. Whereas conventional approaches allocate emissions required to produce capital assets to the year of formation, we propose an alternative perspective through allocating required emissions from the production of assets over their entire lifespans. We show that allocating CO₂ emissions embodied in capital assets over time relieves emission responsibility for the year of formation, with 25‒46% reductions from conventional emission accounts. This temporal allocation, although virtual, is important for assessing the equity of CO₂ emissions across generations due to the inertia of capital assets. To re-allocate emission responsibilities to the future, we design three capital investment scenarios with different investment purposes until 2030. Overall, the existing capital in 2017 will still carry approximately 10% responsibilities of China's CO₂ emissions in 2030, and could reach more than 40% for capital-intensive service sectors.

Allocating China's CO2 Emissions Based on Economic Welfare Gains from Environmental Externalities

To achieve carbon neutrality (i.e., net zero carbon emissions) by 2060, China must make significant changes in its socioeconomic systems, including appropriately allocating emissions responsibility. Traditional methods of delineating responsibilities (such as production-based and consumption-based accounting) can lead to double counting when applied simultaneously and therefore difficulty in determining responsibilities of different agents. An alternative approach based on economic welfare gains from environmental externalities has been refined, ensuring that the responsibilities of consumers and producers add up to the total emissions. The application of this approach to 48 countries and 31 Chinese provinces reveals that regions with less elastic supply and demand, such as Hebei in China and Russia, have higher responsibilities. Furthermore, larger externalities associated with unitary product value shift the burden of obligations from producers to consumers. Regions with high levels of wealth and carbon-intensive imports, such as Zhejiang and Guangdong in China, as well as the United States, typically have higher consumer-based accounting (CBA) emissions than production-based accounting (PBA) emissions and, as a result, redistributed responsibilities between PBA and CBA emissions. The new distribution results vary significantly from PBA or CBA emissions, indicating opportunities for more comprehensive and accessible policy goals.

Decomposition and scenario analysis of final demand embedded manufacturing consumption emissions: insights from the province-level data

In order to support the emissions reduction options in manufacturing industry effectively, it is necessary to quantify the final demand embedded manufacturing consumption (DEMC) emissions which can be estimated by converting intermediate manufacturing consumption into all final demand categories. Here, we quantify the DEMC emissions in China's 30 provinces during 2007-2017 using a multi-regional input-output (MRIO) model and the modified hypothetical extraction method (HEM). Then, we analyze impacts of four factors (including emissions multipliers, consumption structure, investment efficiency, and investment scale) on the DEMC emissions. Finally, considering a large driving effect of investment scale on manufacturing emissions, we conduct four scenarios to quantify the mitigation potential of DEMC emissions during 2020-2035. We find that from 2007 to 2012, the DMEC emissions increased doubled, while during 2012-2017, it decreased from 1217 to 634 Mt. The capital-intensive manufacturing and the labor-intensive manufacturing industries were main sources of intra- and inter-sectoral emissions, respectively. Investment scale was the main driver of the growth in DEMC emissions during 2007-2015, while it led to a reduction of DEMC emissions during 2015-2017. Emission multipliers had the largest positive impact on the reduction of DEMC emissions during the whole period. Consumption structure increased DEMC emissions during 2007-2012, while with the consumption structure shift towards knowledge-intensive manufacturing industry, it induced a reduction of DEMC emissions during 2012-2017. Moreover, implementing an integrated mitigation measures (including reducing emissions multipliers, decreasing investment efficiency, and adjusting consumption structure) could help China to realize the emissions peaking target. However, there are still 8 provinces whose DEMC emissions are unlikely to peak before 2030.

Global Embodied Energy Flow and Stock Analysis with Endogeneous Fixed Capital

Fixed capital stock functions as an embodied energy storage system that connects economic activities which do not happen simultaneously. This paper constructs a dynamic energy input-output model to analyze embodied energy flows and stocks along both temporal and spatial dimensions from 2000 to 2014. The results show that 2043 exajoule of embodied energy was stored in the global fixed capital stock in 2014, which was about three times the world's direct energy use. Compared with those in developed countries, the gaps between the dynamic energy footprints and the traditional ones were larger in fast-developing countries. Net embodied energy usually flowed from high-intensity economies to lower-intensity economies, and around 10% of the energy embodied in trade came from depreciation. The dynamic embodied energy indicators provide information for improving energy efficiency and mitigating corresponding problems from the perspective of consumption.

How Do Environmental Regulations and Outward Foreign Direct Investment Impact the Green Total Factor Productivity in China? A Mediating Effect Test Based on Provincial Panel Data

This paper investigates the impact of two types of environmental regulations (ERs), command-and-control environmental regulation (CACER) and market-incentive environmental regulation (MIER), on green total factor productivity (GTFP) through outward foreign direct investment (OFDI) in 30 provinces in China for the period of 2006-2019. The Global Malmquist-Luenberger (GML) Index based on non-radial directional distance function (NDDF) considering undesired outputs is used to measure GTFP growth at the provincial level. To explore the mediating effect of OFDI, the two-step econometric model and the non-linear mediating effect model are employed. The empirical results show that CACER has an inverted U-shaped impact on OFDI and a U-shaped impact on GTFP, while MIER has a linearly positive effect on OFDI and GTFP. The current intensity of CACER lies on the left side of the inflection point of the U-shaped curve. OFDI significantly positively influences the increase in GTFP and is a significant mediating variable in the relationship between ERs and GTFP. Moreover, the introduction of OFDI delays the appearance of the inflection point. Further analysis, taking into account the regional heterogeneity, indicates that the inverted U-shaped and U-shaped curve is still valid in the eastern and western area and that the mediating effect of OFDI on ERs in the western area is stronger than that in the eastern area. Based on these conclusions, policy implications are provided to improve GTFP in China.

Global pastureland use as reflected in inter-regional supply chain

Pastureland used for livestock grazing is globally much bigger than arable land. This study investigates the pastureland use embedded in global supply chains by using multi-regional systems input-output anlysis, tracing embodied pastureland use from source of exploitation to sink of final consumption in the global economy. The world's pastureland resources is shown reallocated through the supply chain mainly to the four major economies: EU, the United States, China, and Japan. These four economies are responsible for driving more than half of the global pastureland exploitation. Major supply chains responsible for the global reallocation of pastureland use include the cattle supply chain from Other Asia & Pacific to the United States, China, and Japan, and the cattle supply chain from Africa to EU and the Middle East. This paper demonstrates the nature and scale of the global reallocation of pastureland resources through the supply chain, highlighting the fact that the global shift of pastureland use from nature-based to economic-based may exacerbate ecological inequity between world regions. It is proposed that future policies and regulations should encourage sustainability goals not only on a regional level but on a global scale, finding pathways to sustainable and equitable livestock production by inter-regional collaboration.

Environmental degradation and sustainable development of economies: empirical evidence on economic performance

The present paper aims to analyze the influence of environmental practices over the sustainable development of economies which create economic resilience for the economies classified according to different income levels. The authors aim to assess the impact of high environmental degradation (HED) on GDP growth volatility and GDP growth for economies over the long term and short term for the period of 1955-2020 in 124 countries. The findings of empirical analysis conclude that HED economies will have high growth in the long term than their counterparts. The economies of HED have a significant mean difference in volatility with their counterpart control group that implies HED economies have low volatility than the control group. Economies with HED have higher financial development relative to their control economies. The empirical analysis of robustness checks shows that economies with HED have low volatility in GDP and higher growth rates. HED economies enjoy high and sustainable financial development and high gross fixed capital formation, which signifies a high level of investment in their economy than their control counterpart.

The socioeconomic factors of investment-induced petroleum consumption: case of fast developing Chinese economy

Capital investment stimulates a sizable portion of petroleum consumption, especially in emerging economies. However, investment-embedded petroleum consumption (IEPC) and the socioeconomic factors that influence it are not well studied. Our study's objective is to close this research gap. Our article estimates the effects of petroleum intensity, technology, investment structure, and economic development on China's IEPC using input-output and bipolar structural decomposition analysis. Additionally, our article develops a previously mostly unknown index of investment intensity. The findings indicated that, on average, between 1990 and 2016, investment induced nearly 30% of China's total final demand-embedded petroleum consumption. On average, petroleum intensity had the most significant decreasing effect on the Chinese IEPC. Averagely, technology had a positive impact, but from 2010 to 2016, it had a noticeable negative impact (- 1.51 exajoule). Both investment intensity and economic development had a significant upward effect. The impact of investment intensity was the smallest of all the factors. Disaggregation of the effects of socio-economic factors at the sectoral level revealed distinct patterns. Thus, by focusing on the socioeconomic dynamics of key sectors, the factors' current decreasing effects can be maximized, and their increasing effects minimized.

The heterogeneous dynamic effect of financial development and environmental regulation on Chinese urban green technology management efficiency

China is facing the large-scale urbanization and great pressure of energy consumption and environmental protection in the past few decades. In this process, urban green technology management efficiency (GMEC) is of great importance for the future work of greener transformation. Using China's 286 city-level panel data from 2006 to 2018, this paper proposes a global Malmquist index, PVAR, and panel quantile regression model to explore the heterogeneous dynamic effect of financial development (FIN) and environmental regulation (ER) on GMEC. The results indicate that during 2006-2018, (1) the growth rate of GMEC fluctuated violently, with a change of more than 28%. In addition, there is "one tight and one loose" phenomenon of GMEC. This indicates that there is much room for the improvement of GMEC; (2) in northeast cities, FIN is not conductive to GMEC, but in other regional cities, FIN has dynamic beneficial effect on GMEC. In addition, FIN represents a changing trend of dropping at first to rising afterwards in all regional cities; (3) furthermore, from time angle, ER has the heterogenous dynamic effect on GMEC among regional cities. Specifically, in northeast, eastern, central, and western cities, GMEC has an "M," "N," "U," and "U"-shaped relationship with the level of ER, respectively. From space angle, there is distinct heterogeneous effect of ER on GMEC at different quantiles within regional cities. Therefore, the local government are supposed to establish and implement policies based on regional cities' characteristics.

Population Aging and Its Impact on Human Wellbeing in China

Population aging is getting enlarged in the upcoming decades. Meanwhile, old-aged longevity and dependency are getting large due to improvement in life expectancy. In literature, it is claimed that old-aged dependency affects the wellbeing of society. Thus, the study intends to explore the impact of population aging on human wellbeing. The study adopts the Autoregressive Distributed Lag (ARDL) approach for empirical analysis by using time-series series data from 1990 to 2020. The study findings reveal that an increase in population aging reports a significant and decreasing impact on human wellbeing. However, an increase in health expenditure reports a significant and increasing impact on human wellbeing. Thus, China must pay attention to population aging to improve human health.

A global overview of developments of urban and rural household GHG footprints from 2005 to 2015

Household greenhouse-gas footprints (HGFs) are an important source of global emissions but can vary widely between urban and rural areas. These differences are important during the ongoing rapid, global, urbanization process. We provide a global overview of HGFs considering this urban-rural divide. We include 16 global regions, representing 80% of HGFs and analyze the drivers of urban and rural HGFs between 2005 and 2015. We do this by linking multi-regional input-output (MRIO) tables with household consumption surveys (HCSs) from 43 regions. Urban HGFs from high-income regions continue to dominate, at 75% of total HGFs over 2010-2015. However, we find a significant increase of rural HGFs (at 1% yr^-1), reflecting a convergent trend between urban and rural HGFs. High-income regions were responsible for the majority of urban HGFs (USA: 27.8% and EU: 18.7% in 2015), primarily from transport and services, while rural HGFs were predominately driven in emerging regions (China: 24% and India: 21.8% in 2015) mainly driven by food and housing. We find that improving emission intensities do not offset the increase in HGFs from increasing consumption and population during the period. A broad transition of expenditure from food to housing in rural areas and to transport in urban areas highlights the importance of reducing the emission intensities of food, housing, and transportation. Counterintuitively, urbanization increased HGFs in emerging regions, resulting in a >1% increase in China, Indonesia, India and Mexico over the period, due to large migrations of people moving from rural to urban areas.

Analysing the role of environment-related technologies and carbon emissions in emerging economies: a step towards sustainable development

The evaluation of the contribution of consumption-based carbon (CBCO₂) emissions in greenhouse gas (GHG) emissions is crucially important for the design of sustainable environmental policies. Despite its importance, attention to the discussion of the role of environment-related technologies (ERT) in abating CBCO₂ emission is limited. The role of ERT and renewable energy in reducing carbon emissions is investigated in a panel of seven emerging economies during 1990-2016 in the 'Environment Kuznets Curve (EKC)' framework. Cross-sectional dependence test, CIPS unit root test, Westerlund co-integration, and cross-sectional augmented autoregressive distributive lag econometric techniques are employed to support the propositions. Findings suggest the supportive role of environment-related technologies in the presence of renewable energy in reducing carbon emissions. However, GDP growth is substantially worsening the environment. The findings indicate the need to increase investment in environment-related technologies by the E-7 economies for a sustainable reduction in CB CO₂ emissions.

Integrating the inter- and intra-annual dynamic features of capital into environmental footprint assessment: Revisiting China's greenhouse gas footprints, 1995-2015

Assessments of the displacement of pollution emissions or other resources through trade attribute local production to remote consumers, yielding environmental footprints for the respective regions. Recently, the previously neglected temporal dimension of capital goods-built up in the past and continuously serving production activities in the future-has received increasing attention in environmental footprint assessments. Based on an inter-annual dynamic capital-endogenised multi-regional input-output model, this study further integrates the intra-annual dynamic features of capital production and consumption. We quantify the greenhouse gas (GHG) emissions embodied in China's capital consumption over the past two decades and assign this part of GHG emissions into finished goods and services over time. Our results show that China's GHG footprint in 2015 would be 7 Gt if capital-related GHG emissions were considered. This figure is 28% higher than the GHG footprints of China's final consumption estimated by conventional consumption-based accounting (CBA) and 41% lower than that of China's final demand estimated by conventional CBA. Overall, around 8% of GHG footprints would be overestimated if we do not consider the intra-annual dynamic feature of capital in the assessment. The inter-annual allocation shows that the capital-related GHGs of China's final consumption emitted on average in the last six years, which is still increasing owing to the long lifespans of capital assets. In light of the synergies among capital development, environmental sustainability, and human needs satisfaction, it is vital to uphold economic and environmental efficiency in capital development decision-making.

Searching appropriate system boundary for accounting India's emission inventory for the responsibility to reduce carbon emissions

This paper explores the features of accounting for the national carbon emission inventory under four different system boundaries, including the presently operational territorial production-based accounting (PBA) practised by the UNFCCC. Using a recently published input-output table with the base year for 2013-2014, the study calculates India's 'Nationally Determined Contribution (NDC)' to the mitigation of carbon emissions using production-based, consumption-based, sharing-based and equity-based accounting. The study finds India as a net importer of carbon emissions, especially for its high emission-intensive capital and energy goods import such that the country is bearing the minimum burden of emission reduction responsibility. However, the study intends to analyse this burden of responsibility in terms of the criteria of justice and effectiveness and addresses the future policy priorities for India to become a net exporter of industrial goods. We recommend India for supporting and implementing an alternative system boundary of emission inventory accounting which would be more consistent with the provisions of 'equity' subscribed under the UNFCCC while at the same time, helpful for achieving the climate goals by appropriately trace and track the sources of 'carbon leakage'.

An asymmetric analysis of the role of exports and imports in consumption-based carbon emissions in the G7 economies: evidence from nonlinear panel autoregressive distributed lag model

A genuine concern faced by the present world is global warming. Millions of human and animal lives are at risk due to global warming. Therefore, the subject has gained enormous attention from research and academia around the world. Literature shows that the primary cause of global climate change or global warming is carbon (CO₂) emissions. Hence, the role of a reliable carbon emission measurement is important for devising a relevant climate policy to deal with environmental problems. Based on trade-adjusted statistics of carbon emissions, a relevant climate policy response can be provided. Unlike the previous studies, this study examines the asymmetric impact of international trade on consumption-based carbon emissions from 1990 to 2017 in the G7 economies. To get empirical estimates, the study applies second-generation co-integration technique and nonlinear panel autoregressive distributive lag (NPARDL) model for estimating the relevant coefficients. The empirical results show that positive growth of exports significantly decreases consumption-based carbon emissions both in the short and long run, whereas the impact of negative growth of exports is insignificant. For imports, the results show that, over time, positive growth of imports significantly increases consumption-based carbon emissions in the long run, while the impact of negative growth of imports is insignificant. Finally, it is recommended for the policymakers to target the export industries for relevant policy interventions, which are less polluting and can generate other economic benefits as well.

Exploring the asymmetries between trade and consumption-based carbon emissions: evidence from NPARDL approach

Global warming is one of the most serious environmental problems that the world faces today. Millions of human lives are at risk, hence the subject has gained enormous attention within academia and the research arena. Literature shows that the primary cause of global climate change or global warming is carbon (CO₂) emissions. In the literature, a number of studies have investigated the factors affecting the overall level of carbon emission. However, in recent years, consumption-based carbon emissions have occupied the center stage in research related to international trade and environmental concerns. The recently emerged idea of carbon emissions based on consumption differs from conventional accounting (i.e., carbon emissions based on production) in that it highlights the importance of international trade in national carbon emissions. Unlike the previous studies that examined the symmetric effect of international trade on consumption-based carbon emission, the present study examines the asymmetric effect of international trade on consumption-based carbon emissions of emerging economies. To get empirical estimates, the study applies a Nonlinear Panel Autoregressive Distributive Lag (NPARDL) approach. The estimates show that both in the short and long run, a positive shock in exports significantly reduces consumption-based carbon emissions in developing economies. Whereas, a negative shock in exports has an insignificant impact on carbon emissions. For imports, the results show that, over time, positive shocks in imports significantly increase consumption-based carbon emissions, while the impact of negative shocks is insignificant. Finally, it is recommended for the policymakers to target the export industries for relevant policy interventions, which are less polluting but crucial for economic growth.

Linking the Environmental Pressures of China's Capital Development to Global Final Consumption of the Past Decades and into the Future

China's rapid growth was fueled by investments that grew more than 10-fold since 1995. Little is known about how the capital assets acquired, while being used in productive processes for years or decades, satisfy global final consumption of goods and services, or how the resource use and emissions that occurred during capital formation are attributable to past or future consumption. Here, enabled by a new global model of capital formation and use, we quantify the linkages over the past 2 decades and into the future between six environmental pressures (EPs) associated with China's capital formation and attributable to Chinese as well as non-Chinese consumption. We show that only 35% of the capital assets acquired by China from 1995 to 2015, representing 32-39% of the associated EPs (e.g., water consumption, greenhouse gas (GHG) emissions, and metal ore extractions), have been depreciated, while the majority rest will serve future production and consumption. The outsourcing of capital services and the associated EPs are considerable, ranging from 14 to 25% of depending on the EP indicators. Without accounting for the capital-final consumption linkages across time and space, one would miscalculate China's environmental footprints related to the six EPs by big margins, from -61% to +114%.

Increased inequalities of per capita CO2 emissions in China

Designing inter-regional and inter-provincial responsibility-sharing mechanisms for climate change mitigation requires the knowledge of carbon distributions. This study is the first to use a two-sector (i.e., productive and household sectors) inequality decomposition approach to examine the regional, provincial, and national inequalities of per capita CO₂ emissions (CPC) in China, as well as their determinants. We show that the CPC inequality index in China increased from 1.1364 in 2000 to 2.3688 in 2017, with the productive sector accounting for 91.42% of this expansion and households responsible for the rest. The production-side per capita output level, energy efficiency, energy structure, and industrial structure explain 69.01%, 12.81%, 5.57%, and 4.03% of these inequalities, respectively. Further, the household per capita energy consumption and energy structure explain only 8.12% and 0.46%, respectively. Therefore, future responsibility-sharing mechanisms for climate mitigation need to be formulated taking mainly the productive sector into account.

Unveiling Carbon Emission Attributions along Sale Chains

Substantial anthropogenic emissions have resulted in serious environmental problems in China. Direct emissions and demand-pulled emissions along the supply chains have been extensively investigated. However, understanding the mechanism of how the sectoral emission is transferred through production activities along the sale chains at different production layers remains a challenge. In this paper, a top-down multilayer emission attribution model is developed to unveil the metabolism of multilayer input-driven emissions. For the first time, a diagramming approach enables the exhaustive depiction of the connections between primary input attributions and final production attributions, which allows accurate reallocation of the emission responsibilities to sectors at different production layers. Individual sale chain paths and supply chain paths have been extracted and ranked according to the contributions of emissions. A four-perspective comparison of sectoral emissions (i.e., direct emissions along sale chains, enabled emissions, direct emissions along the supply chains, and embodied emissions) is assessed. We find that at multiple production layers, sectoral direct emissions along the sale chains differ greatly from direct emissions along the supply chains. By comprehensively considering providers, consumers, and producers within a metabolic system, policy-makers should encourage upstream sectors to improve their cleaner production technologies and downstream sectors to adjust their industrial structures.

An embodied energy perspective of urban economy: A three-scale analysis for Beijing 2002-2012 with headquarter effect

As the typical characteristic of globalization, large-scale agglomeration of headquarters in urban economies exerts extensive cross-border trade links, and inevitably generates energy use outside their boundary. Therefore, studies about urban economies' energy use profiles should pay special attention to the tremendous energy transfers embodied in their trade connections along the whole supply chain. In this regard, a three-scale input-output model which distinguishes local, domestic and foreign activities is devised to reflect cross border embodied energy perspective for urban economies, with an intensive case study for Beijing during 2002-2012. The results show that domestic imports dominate Beijing's total embodied energy use, while local energy exploitation accounts for less than one-tenths of the final use. Regarding to energy use embodied in trade, headquarter effect contributes significantly to the rapid growth of embodied energy inflows and outflows. Embodied energy transfers induced by headquarter effect almost doubled in the case period. Different industries show distinct embodied energy redistribution evolution characteristics. Moreover, the complete source-to-sink budget is constructed, implying that coal use still dominates Beijing's total embodied energy inputs. Analysis in this study highlights the importance to consider the impacts of headquarter effect on Beijing's embodied energy use and redistribution pattern, pointing the potential room for policy implications aimed to realize collective and inclusive governance of global energy supply chain.

China's CO2 emissions embodied in fixed capital formation and its spatial distribution

This study aims to measure China's CO₂ emissions embodied in fixed capital formation (FCF) from 2007 to 2017 by using both a multi-regional input-output (MRIO) model and a single-region input-output model (SRIO). Then decoupling analysis was performed for uncovering the relationship between embodied CO₂ emissions and added values at provincial level. Logarithmic Mean Divisia Index (LMDI) method was further conducted to identify driving factors underlying the growth of embodied CO₂ emissions. Results show that CO₂ emission from FCF doubled from 2436 million tons (Mt) in 2007 to 4820 Mt in 2012, and increased slightly to 5089 Mt in 2017. Electric power, gas, and water production and supply sector (EGW) and manufacturing industry (MFI) sector were two dominant emitters from supply-side perspective, while construction (CON) was the largest demanding sector driving the embodied emissions from upstream sectors. From geographical point of view, northern provinces were the major inter-regional net exporters of embodied CO₂ emissions, while eastern and southern provinces were net importers of embodied CO₂ emissions. Based on such results, policy recommendations are proposed considering the relation between supply and demand sector, inter-provincial CO₂ emission transfer, and local economic development to mitigate CO₂ emissions from China's FCF.

Carbon inequality and economic development across the Belt and Road regions

Given the aim of maintaining global warming below 2 °C, carbon emission reduction has become a global top priority. Since the Belt and Road Initiative has increasing influence on manufacturing-oriented developing countries, more attention should be paid to carbon emission reduction in these regions. This study conducts a comprehensive analysis by analyzing the carbon inequality and regional development and compares the carbon emissions driven by final demand among countries in and outside the Belt and Road area from 1990 to 2015. It is found that the majority of the Belt and Road regions achieved a rapid GDP growth rate with increasing carbon emissions, in which the investment-driven type demonstrated a significant growth. In contrast, the developed countries outside the Belt and Road area maintained their economic growth while decreasing the carbon emissions owed to the declining of investment-driven emissions; however the consumption-driven emissions stably remained a relatively high level. Our results showed that the inequality of carbon emission within Belt and Road regions is lower than the global average, while the inequality of the investment-driven emissions showed an obviously increasing trend. By discussing the carbon inequality and regional development, rational and feasible strategies for countries and regions within and outside the Belt and Road area are essential, and different types of strategies such as low-carbon technologies transfers and overseas financial cooperation are suggested for regional carbon emission reduction and sustainable regional development under the Belt and Road Initiative.

Dynamic Input–Output Analysis of a Carbon Emission System at the Aggregated and Disaggregated Levels: A Case Study in the Northeast Industrial District

Research on carbon emissions of complex interactive activities in urban agglomerations is one of the hotspots of global climate change research. A comprehensive analysis of the urban agglomeration system’s carbon emissions is essential to reveal strategies for reduction and support sustainable development. The objective of this research is to develop an integrated carbon emission network model to explore the impact of different energy types on the Northeast Industrial District (NID), China. Four representative energy groups are considered. Specifically, at the aggregated sector-level, this research quantified the relative contributions of socioeconomic factors to carbon emission changes using structural decomposition analysis and examined the system efficiency and redundancy through robustness analysis. At the disaggregated level, the research investigated carbon emissions of different sectors from production-based, consumption-based, and income-based viewpoints. Moreover, emissions from specific categories of final demand and primary input were quantified. It was found that the increase of final demand level will proceed to push up the carbon emissions of the NID. Changing the production structure contributes to reducing emissions. The carbon emissions system has a high redundancy and low efficiency, illustrating that there are many emission pathways within the system. In addition, the use of crude oil significantly increases system redundancy and inhibits system efficiency. However, the major limitation of the model is that the long-term changes of the system are not considered. Moreover, considering the actual policies, emission reduction simulations could be added in the future.

Towards a more effective climate policy on international trade

In the literature on the attribution of responsibilities for greenhouse gas emissions, two accounting methods have been widely discussed: production-based accounting (PBA) and consumption-based accounting (CBA). It has been argued that an accounting framework for attributing responsibilities should credit actions contributing to reduce global emissions and should penalize actions increasing them. Neither PBA nor CBA satisfy this principle. Adapting classical Ricardian trade theory, we consider ex post measurement and propose a scheme for assigning credits and penalties. Their size is determined by how much CO₂ emissions are saved globally due to trade. This leads to the emission responsibility allotment (ERA) for assigning responsibilities. We illustrate the differences between ERA and PBA and CBA by comparing their results for 41 countries and regions between 1995-2009. The Paris Agreement (COP21) proposed new market mechanisms; we argue that ERA is well suited to measure and evaluate their overall mitigation impact.

Global Circular Economy Scenario in a Multiregional Input-Output Framework

In a resource-constrained world of an estimated 10 billion people in 2050 with the same material aspirations of today's high-income nations, there is no question: The future economy will need to be circular. From a policy perspective, the question is whether averting catastrophic environmental impacts through an accelerated transition to a global circular economy can also deliver sustained growth and jobs. The adoption of circular economy measures will have a range of effects on both domestic and foreign supply chains. Multiregional input-output (MRIO) analysis models the interdependencies between industries and within and between countries as well as between intermediate and final goods producers and consumers. It provides a useful toolbox for assessing social, environmental, and economy-wide impacts of the adoption of the circular economy. We project the MRIO database EXIOBASE to 2030 on the basis of the exogenously given parameters of the International Energy Agency's Energy Technology Perspective (IEA ETP) 6-degree scenario. We compare this business-as-usual (BAU) scenario and an alternative circular economy scenario. The circular economy scenario considers more recycling, reducing (material efficiency increase), repair, and reuse in relation to the BAU scenario. The adoption of circular economy measures has diverse impacts on the economy and environmental pressures. Global material extraction is reduced by about 10% compared to the baseline, while the impact on employment is small but positive. In particular, the shift from resource extracting sectors to the service sector will provide more opportunities for high-skilled and female workers.

The carbon footprint of the U.S. multinationals' foreign affiliates

Multinational enterprises (MNE) need to be a part of the solution in the fight against climate change, as claimed by investors and consumers, reducing emissions within their operations and supply chains. This paper measures the carbon footprint of U.S. MNE foreign affiliates (US-MNE) operating beyond the U.S. borders. Using a multiregional input-output model and information about US-MNE activities, the US-MNE carbon footprint ranks US-MNE as the 12th top emitter of the world. In relative terms, one dollar of value added generated by US-MNE affiliates operating abroad requires higher emissions than the domestic average and the ratio increases when only developing host countries are considered. Only 8% of total carbon footprint returns to the U.S. as virtual carbon embodied in the U.S. final consumption. Potential technology transfers between the U.S. parent company and affiliates to reduce US-MNE carbon footprint have been performed to evaluate potential rippled effects of mitigation actions.