Towards Robust, Authoritative Assessments of Environmental Impacts Embodied in Trade: Current State and Recommendations

14 Pages Posted: 5 Jun 2018

See all articles by Jannick H. Schmidt

Jannick H. Schmidt

Leiden University

Arjun de Koning

Leiden University - CML, Department Industrial Ecology

Anne Owen

University of Leeds

Stephan Lutter

Vienna University of Economics and Business

Martin Bruckner

Vienna University of Economics and Business

Stefan Giljum

Vienna University of Economics and Business

Konstantin Stadler

Norwegian University of Science and Technology (NTNU) - Department of Industrial Economics and Technology

Richard Wood

Norwegian University of Science and Technology (NTNU)

Rutger Hoekstra

Vrije Universiteit Amsterdam, School of Business and Economics

Date Written: June 2018

Abstract

Global multiregional input‐output databases (GMRIOs) became the standard tool for tracking environmental impacts through global supply chains. To date, several GMRIOs are available, but the numerical results differ. This paper considers how GMRIOs can be made more robust and authoritative. We show that GMRIOs need detail in environmentally relevant sectors. On the basis of a review of earlier work, we conclude that the highest uncertainty in footprint analyses is caused by the environmental data used in a GMRIO, followed by the size of country measured in gross domestic product (GDP) as fraction of the global total, the structure of the national table, and only at the end the structure of trade. We suggest the following to enhance robustness of results. In the short term, we recommend using the Single country National Accounts Consistent footprint approach, that uses official data for extensions and the national table for the country in question, combined with embodiments in imports calculated using a GMRIO. In a time period of 2 to 3 years, we propose work on harmonized environmental data for water, carbon, materials, and land, and use the aggregated Organization for Economic Cooperation and Development (OECD) Inter‐Country Input‐Output GMRIO as default in combination with detailing procedures developed in, for example, the EXIOBASE and Eora projects. In the long term, solutions should be coordinated by the international organizations such as the United Nations (UN) Statistical Division, OECD, and Eurostat. This could ensure that when input‐output tables and trade data of individual countries are combined, that the global totals are consistent and that bilateral trade asymmetries are resolved.

Keywords: embodiments in trade, footprints, impact assessment, industrial ecology, input‐output analysis (IOA), statistical offices

Suggested Citation

Schmidt, Jannick H. and de Koning, Arjun and Owen, Anne and Lutter, Stephan and Bruckner, Martin and Giljum, Stefan and Stadler, Konstantin and Wood, Richard and Hoekstra, Rutger, Towards Robust, Authoritative Assessments of Environmental Impacts Embodied in Trade: Current State and Recommendations (June 2018). Journal of Industrial Ecology, Vol. 22, Issue 3, pp. 585-598, 2018. Available at SSRN: https://ssrn.com/abstract=3189138 or http://dx.doi.org/10.1111/jiec.12716

Jannick H. Schmidt (Contact Author)

Leiden University

Postbus 9500
Leiden, 2300 RA
Netherlands

Arjun De Koning

Leiden University - CML, Department Industrial Ecology ( email )

PO Box 9518
Leiden, ZH NL-1012DE
Netherlands

Anne Owen

University of Leeds ( email )

Leeds, LS2 9JT
United Kingdom

Stephan Lutter

Vienna University of Economics and Business

Welthandelsplatz 1
Vienna, Wien 1020
Austria

Martin Bruckner

Vienna University of Economics and Business

Welthandelsplatz 1
Vienna, Wien 1020
Austria

Stefan Giljum

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, Wien 1020
Austria

Konstantin Stadler

Norwegian University of Science and Technology (NTNU) - Department of Industrial Economics and Technology ( email )

NO-7491 Trondheim
Norway

Richard Wood

Norwegian University of Science and Technology (NTNU) ( email )

Trondheim NO-7491
Norway

Rutger Hoekstra

Vrije Universiteit Amsterdam, School of Business and Economics ( email )

De Boelelaan 1105
NL 1081 HV Amsterdam
Netherlands
+31(0)20 444 6142 (Phone)

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