Carbon and Materials Embodied in the International Trade of Emerging Economies

Abstract

SummaryProduction in emerging economies, such as Brazil, Russia, India, China, South Africa, and Argentina (BRICSA), increased substantially over the past two decades. This is, on the one hand, due to growing domestic demand within these countries, and, on the other hand, due to a deepened international division of work. Global trade linkages have become denser and production chains are no longer restricted to only one or two countries. The volume of international trade in intermediate inputs as well as final consumption goods has tripled in the past two decades. With this, carbon dioxide (CO2) emissions and materials embodied in traded goods have increased, making it increasingly difficult to identify the actual causes of emissions and material extractions, as producing and extracting countries are not necessarily consuming the resulting goods. Using the multiregional input‐output Global Resource Accounting Model (GRAM), this article shows how global carbon emissions and materials requirements are allocated from producing/extracting countries to consuming countries. It thereby contributes to the rapidly growing body of literature on environmental factors embodied in international trade by bringing two key environmental categories—CO2 emissions and materials—into one consistent and global framework of analysis for the first time. The results show that part of the increase in carbon emissions and materials extraction in BRICSA is caused by increasing amounts of trade with countries in the Organisation for Economic Co‐operation and Development as well as a growing demand for goods and services produced within BRICSA.