Maaike C. Bouwmeester

Exiopol - Development And Illustrative Analyses Of A Detailed Global Mr Ee Sut/Iot

EXIOPOL (A New Environmental Accounting Framework Using Externality Data and Input–Output Tools for Policy Analysis) was a European Union (EU)-funded project creating a detailed, global, multiregional environmentally extended Supply and Use table (MR EE SUT) of 43 countries, 129 sectors, 80 resources, and 40 emissions. We sourced primary SUT and input–output tables from Eurostat and non-EU statistical offices. We harmonized and detailed them using auxiliary national accounts data and co-efficient matrices. Imports were allocated to countries of exports using United Nations Commodity Trade Statistics Database trade shares. Optimization procedures removed imbalances in these detailing and trade linking steps. Environmental extensions were added from various sources. We calculated the EU footprint of final consumption with resulting MR EE SUT. EU policies focus mainly on energy and carbon footprints. We show that the EU land, water, and material footprint abroad is much more relevant, and should be prioritized in the EUs environmental product and trade policies.

A NOTE ON THE GRAS METHOD

The GRAS method as presented by Junius and Oosterhaven [Junius, T. and J. Oosterhaven (2003) The Solution of Updating or Regionalizing a Matrix with Both Positive and Negative Elements. Economic Systems Research, 15, 87–96] assumes that every row and every column of a matrix to be balanced has at least one positive element. This might not necessarily be true in practice, in particular, when dealing with large-scale input–ouput tables, supply and use tables, social accounting matrices, or, for that matter, any other matrix. In this short note we relax this assumption and make available our MATLAB program for anyone interested in matrix GRASing. The same issue arises in the presentations of the KRAS method [Lenzen, M., B. Gallego and R. Wood (2009) Matrix Balancing Under Conflicting Information. Economic Systems Research, 21, 23–44] and the SUT–RAS method [Temurshoev, U. and M.P. Timmer (2011) Joint Estimation of Supply and Use Tables. Papers in Regional Science, 90, 863–882], which should be accordingly accounted for in their empirical applications.

A NEW APPROACH TO MODELING THE IMPACT OF DISRUPTIVE EVENTS

This paper develops a new methodology to predict the interregional and interindustry impacts of disruptive events. We model the reactions of economic agents by minimizing the information gain between the pre- and postevent pattern of economic transactions. The resulting nonlinear program reproduces, as it should, the pre-event market equilibrium. The methodology is tested further by means of a comparison of this base scenario with two regional production shock scenarios and two interregional trade shock scenarios. The outcomes show a plausible combination of partially compensating demand, supply, and spatial substitution effects, which justifies the further development, testing, and application of this new approach.

A NEW SUT CONSOLIDATION METHOD TESTED BY A DECOMPOSITION OF VALUE ADDED AND CO2 EMBODIED IN EU27 EXPORTS

This paper develops a method to consolidate national supply–use tables (SUTs) into a single supra-regional SUT. The method deals with mirror trade statistics problems, such as the different valuation of imports and exports, and it corrects for double-counting re-exports. The method is tested by means of a decomposition of value added and CO2 emissions embodied in EU27 exports to third countries. When the national SUTs for the period 2000–2007 are used, neglecting intra-European Union spillover and feedback effects results in an underestimation of the embodied value added of 12–15%. Not consolidating the national tables properly leads to a further underestimation of 11–16%. With these underestimations removed, EU27 foreign exports still only explain around 11% of EU27 Gross Domestic Product, whereas they explain 17% of the EU27 CO2 emissions. Hence, the income benefits of these exports are, in relative terms, considerably smaller than their CO2 emission cost.

The Average Propagation Length: Conflicting Macro, Intra-industry, and Interindustry Conclusions

The average propagation length (APL) has been proposed as a measure of the fragmentation and sophistication of an economy. For a one-sector economy, we show that the APL is strictly proportional to the macro multiplier of that economy. The same holds for strong intra-industry linkages. Hence, for comparing economies and comparing single industries, the concept of the APL is of no value. For pure interindustry linkages, however, we find that the length of the supply chain between two different industries is negatively related to the strength of the multiplier between those two industries, be it weakly. Hence, the APL should only be used to compare pure interindustry linkages.