Transportation, storage and GHG emissions: A new perspective of input-output subsystem analysis

Abstract

We develop an input–output subsystem analysis based on the Ghosh model to study the emissions of a sector given the productive structure of the economy. Our method complements the traditional subsystem analysis based on the demand-driven model by considering the emissions associated to the primary inputs of the subsystem. This is particularly relevant to study the emissions associated to the activity of sectors that produce mainly for other sectors. We apply both methodologies to analyze the transportation and storage subsystem emissions in Spain in 2014. The outcomes from the demand-driven model point to land and air transport as the main responsible for subsystem emissions, while the supply-driven model also considers storage sector as significant in explaining the subsystem emissions. When intermediate demand is relevant, the consideration of both models helps to better identify the activities responsible for the subsystem emissions, allowing for more accurate policy recommendations.