Network-Based Allocation of Responsibility for GHG-Emissions

36 Pages Posted: 1 May 2023

See all articles by Rosa van den Ende

Rosa van den Ende

Université Paris 1 Panthéon-Sorbonne; Bielefeld University

Antoine Mandel

Université Paris I Panthéon-Sorbonne; Climate Finance Alpha

Agnieszka Rusinowska

CNRS - Paris School of Economics

Date Written: April 26, 2023

Abstract

We develop a network-based model to assign responsibility for direct and indirect emissions. We introduce a responsibility measure which is based on exponential discounting and takes into account the relative share of responsibility for both upstream and downstream emissions. The responsibility for emission is computed on the basis of the discounted sum of walks for a given node in a given network. It corresponds to a convex combination of the Bonacich centralities for the upstream and downstream weighted adjacency matrices. In view of legal disputes and international negotiations on assigning emissions responsibilities, we apply a normative approach based on the set of appropriate axioms and provide axiomatic foundations for designing liability of GHG-emissions. The responsibility measure is characterized by a set of natural and appealing axioms such as anonymity, monotonicity, additivity, tail-convergence, recursivity and consistency. We support our theoretical results by applying the model to the World Input-Output Database 2016 Release.

Keywords: upstream and downstream emission responsibilities, networks, responsibility measure, axiomatization, Bonacich centrality

JEL Classification: D85, F18, F64, Q50, Q56

Suggested Citation

van den Ende, Rosa and Mandel, Antoine and Rusinowska, Agnieszka, Network-Based Allocation of Responsibility for GHG-Emissions (April 26, 2023). Available at SSRN: https://ssrn.com/abstract=4430393 or http://dx.doi.org/10.2139/ssrn.4430393

Rosa Van den Ende (Contact Author)

Université Paris 1 Panthéon-Sorbonne ( email )

ISJPS
5, Place du Panthéon
Paris, 75005
France

Bielefeld University ( email )

Universitätsstraße 25
Bielefeld, NRW 33613
Germany

Antoine Mandel

Université Paris I Panthéon-Sorbonne ( email )

17, rue de la Sorbonne
Paris, IL 75005
France

Climate Finance Alpha ( email )

20 rue de Vintimille
PARIS 9E ARRONDISSEMENT, 75009

Agnieszka Rusinowska

CNRS - Paris School of Economics ( email )

3, rue Michel-Ange
106-112 Boulevard de l'Hôpital
Paris cedex 16, 75794
France

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