A residual-free decomposition of the sources of carbon dioxide emissions: a case of the Korean industries

Abstract

This paper introduces a new method to estimate and decompose sources of carbon dioxide emissions using the input–output model. This method uses what we call the ‘mean rate-of-change index’ for weights of the decomposed terms. In this journal, Ang et al. asserted that logarithmic mean divisia index is superior to Laspeyres index or its variants since the former reduces unexplained residual to zero. Our method provides more plausible and reasonable results than the other methods because it enables residual-free decomposition even when data contain negative values, which logarithmic mean divisia index cannot handle.