Multi-regional Input-output Tables Research Articles

Regionalizing the supply chain in process life cycle inventory with multiregional input–output data: An implementation for ecoinvent with EXIOBASE

AbstractLife cycle inventory (LCI) databases, such as ecoinvent, are crucial for life cycle assessment (LCA), but lack country‐specific resolution in activity details and trade between regional activities in the supply chain. For example, ecoinvent only provides rest‐of‐world and European datasets for photovoltaic panel production, consuming the same global consumption mix of photovoltaic cells. Global or continental activities and trade limit the use of existing country activities, such as electricity production, and the accuracy and granularity of LCA results. We addressed this issue by disaggregating ecoinvent's global and continental unit processes to the country level and by regionalizing trade using country‐sector‐specific consumption mixes of product origins from the multiregional input–output table EXIOBASE. This produced a consistently regionalized ecoinvent at country level. Comparing the climate change impacts of 195,708 non‐market datasets in our regionalized ecoinvent with reference datasets in ecoinvent reveals manufacturing sectors as the most affected. The study of photovoltaic panel production shows that the differences in climate change impacts are mainly due to the different country‐specific suppliers of components and their electricity mixes, which are lost in the aggregated original data. The water consumption impacts of wheat production show the country differences only when regionalized CFs are applied, indicating that regionalized biosphere and technosphere flow amounts are needed for better results. The mapping quality between ecoinvent and EXIOBASE and inconsistent market definitions were discussed along with further limitations. Our study highlights the potential of incorporating better trade information and regional disaggregation in LCI databases to improve the LCA outcomes.

Indirect channel of trade agreements in deepening global value chains

AbstractPreferential trade agreements (PTAs) between trading partners are known to have positive impact on the expanding and deepening of global value chain integration due to lower trade and investment barriers. Less is known, however, is if other PTAs of PTA partners have any impact on the value‐added trade linkages of the direct PTA partners concerned. Based on compositive indicators measuring the breadth and depth of PTAs from 2007 to 2018 and using Multiregional Input–Output Table database covering 62 countries and 35 sectors and the Content of Deep Trade Agreements database, this paper estimates the multiplicative form of the constant‐elasticity augmented gravity equation model by a Poisson Pseudo Maximum Likelihood (PPML) estimator. This study shows that indirect impact of the deepening of trade agreements of a country's PTA partner exerts positive, significant impact on value‐added exports of a country. Both backward and forward linkages of a country measured by various decomposition of valued added exports indicate this indirect channel of value chain deepening effect even outweighs the direct impact from the deepening of PTAs between direct trading partners with significant policy implications in formulating PTA strategies.

Firm's position in global value chains and its impact on pollutant emissions: Evidence from Chinese manufacturing firms

This paper studies examines how a firm's position in the global value chain affects its pollutant emissions. This paper integrates China's firm-level trade data into China's multi-regional input-output tables to provide an index to measure a firm's position in global value chains. Based on a firm-level pollution dataset (2000–2014) in China, this paper conducts an empirical analysis and find that the most-downstream firms on the global value chain have lower pollutant emission intensity. Our results also suggest that the production factor structure effect, the knowledge absorption effect and the abatement investment effect together contribute to the emission intensity gap between the most-upstream firms and the most-downstream firms. These novel results are significant in guiding firms towards reducing their emissions and promoting a green global value chain, with the ultimate goal of achieving multinational environmental protection.

Does industrial relocation impact green economic efficiency? Evidence from China’s energy-intensive industries

Utilizing the latest multi-regional input-output (MRIO) tables and spatial econometric model, this paper measures the inter-provincial relocations of energy-intensive industries (REI) in China and investigates its impact on regional green economic efficiency (RGE). The results indicate that the primary inflow areas of energy-intensive industries are northern coastal, central, and northwestern China, while the main outflow areas are southeastern coastal and southwestern China. The net inflow of energy-intensive industries negatively affects local RGE but positively affects neighboring provinces. However, at the national, REI contributes to improving the overall RGE. This improvement effect varies regionally and has been notably attenuated after the implementation of the Belt and Road Initiative (BRI). Additionally, this paper verifies that the crowding-out effect on R&D investment is an important channel through which REI affects RGE.

Tracing agricultural land carbon loss through transregional food consumption for fairness of responsibility allocation

Agricultural land carbon loss (ALCL) has been increasingly triggered by transregional food consumption in China. Understanding land carbon burden from consumption side is then recognized to be essential for facilitating regional fairness. To this end, we combined physical food-orient multi-regional input-output table and ALCL inventory for 26 kinds of foods in 31 provinces to trace China's ALCL through cross-regional consumption. Results show that ALCL embodied in inter-provincial trade was up to 42 % of the national total ALCL. Food consumption in Guangdong caused the largest ALCL, while Tibet and Qinghai stood out from per capita perspective. Furthermore, consuming foods produced in areas with higher production ALCL intensity would elevate national ALCL, thus shrinking the adverse flows and controlling agricultural land expansion in high-intensity areas may help lessen national ALCL. This study contributes to equitable allocation of responsibility for land carbon loss, and enlightens future land carbon loss risks and restoration opportunities.

Spatio-temporal patterns and cascading risks of embodied energy flows in China

The increasingly complex interrelation between energy use and trade is challenging the secure management of energy. However, limited knowledge of the cascading risks of embodied energy in trade is understood. An embodied energy network of China's interprovincial trade was established based on China's multiregional input-output tables for 2012 and 2017. The pivotal nodes, main flows, and flow trajectories within the embodied energy network were identified using the complex network model. Subsequently, the cascading effects within the embodied energy network were simulated using a cascading failure model. The results indicate that a substantial portion of embodied energy flows is concentrated within a few provinces and sectors. Within the provincial-sectoral network, approximately 50 % of the edges carry 90 % of the embodied energy flows. Sectors exhibiting robust influence, significant intermediary capacity, and pronounced centrality assume pivotal positions within the network. Due to cascading effects, a supply crisis in one crucial province or sector can spread quickly, affecting the entire energy network. This study contributes to ensuring regional energy supply security and offers fresh insights into mitigating cascading risks in the energy system within and beyond China.

Revisiting methods for estimating interregional input-output accounts: It's not just about trade flows

A basic underlying assumption in most of the research to date is that intermediate industry accounts of the economies in multiregional input-output (MRIO) tables exist and are accurate. In fact, if they exist at the subnational level, such accounts are, at best, roughly estimated and predicated on far less empirical information than is available for economies of nations. Moreover, intra-economy intermediate-industry flows are typically larger than the set of a region's commodity in- and out-flows. So, if intermediate industry flows in a set of MRIO accounts are noticeably mis-estimated, it follows that interregional trade coincidentally derived using them must be even more conspicuously in error.We hypothesize as more information is used to estimate MRIO accounts, the better the estimates should be. We start our experiment by consolidating 2019 FIGARO accounts of the 27 member states of the European Union, while maintaining sectoral detail, to produce a “national account”. We then test several approaches to constructing MRIO tables. The approaches distribute interregional trade fully by receiving industry, as in FIGARO, as well as strictly in the form of a diagonalized matrix as if the commodity inflows are competitive imports. To do this, both a gravity model and RAS are applied to each approach. We then test to see how well the approaches estimate main features of FIGARO's MRIO accounts and detail a rather consistent ranking of the relative accuracy of them. We also find that the level of error inherent to the estimated MRIOs is markedly similar across approaches, particularly for multipliers. Further, relaxing interregional trade to a diagonalized matrix tends to add very little error. The approach that uses the least data is, however, markedly worse in replicating countries’ direct requirements matrices and Leontief inverses, which suggests its use in a more-limited set of applications.

The inequality of household carbon footprint in China: A city-level analysis

Climate change mitigation and carbon inequality reduction are of great significance to the sustainable development. Most of the existing studies on China's household carbon footprint inequality are at provincial level and lack in-depth analysis of cross-dimension of consumption categories. We calculated the carbon footprints in 309 city-level areas in China based on the multi-regional input-output table, and further explored the inequality of household carbon footprints from perspective of cross-dimension with Gini coefficient and Lorentz curve based on the China Family Panel Studies dataset. We found that although the carbon footprint inequality of different areas, income groups and family size were relatively high on the whole, the level of that in different consumption categories showed significant different characters. For instance, affluent demographics possess the requisite financial capacity to acquire luxury apparel, whereas economically disadvantaged cohorts predominantly procure garments at standard price points. This dynamic may engender heightened carbon disparity within the realm of clothing, with a proclivity for greater imbalances observed in high-income strata as opposed to their low-income counterparts. Specific measures for guiding residents to rationally consume luxury food and allocate educational resources, and advocate low-carbon travel to eliminate household carbon footprint inequality in China are proposed.

How to improve the energy-saving performance of China's transport sector? An input–output perspective

The transport sector proves a major energy consumer in China, but improving energy-saving performance in China's provincial transport sector from the lifecycle perspective remains unresolved. Thus, this study employs the environmentally extended multi-region input–output (MRIO) method, structural path analysis, and the newest MRIO table of China from 2017, to investigate how to improve the energy-saving performance from final demand structure, supply chain, and pathway perspectives. The relevant results are threefold. (1) Regarding the final demand structure level, the embodied energy consumption of China's transport sector is predominantly driven by investment from the production side, while that of the consumption side is primarily caused by exports. (2) At the supply chain level, production-side embodied energy consumption primarily occurs along a three-echelon supply chain, while that from the consumption side mostly occurs via a two-echelon supply chain. (3) At the pathway level, the production-side energy-saving performance of China's provincial transport sector is dominated by two pathways along the construction sector, including transport sector → construction sector → final demands, and transport sector → intermediate inputs → construction sector → final demands, while that of the consumption side is chiefly determined by three pathways along internal transportation chains.

Trade impact analysis on the profit and loss of agroecosystem service value in Guangdong Province

Due to the imbalance in the supply and demand of agricultural land, there is an increasing trend of land resources being remoted utilized across regions. Within the context of regional trade, changes in the agroecosystem service value (ESV) can be used to assess consumer responsibility. However, the embodied flow of ESV and its driving factors have been largely unexplored. This paper, utilizing the latest Chinese multi-regional input–output tables and the equivalence factor method, explores the spatiotemporal characteristics of embodied agricultural land and ESV flow between Guangdong and 30 other provinces, and further seeks to construct three types of embodied ESV models to reveal the driving factors. The findings reveal that during the process of domestic trade in goods and services, Guangdong Province has an inflow of 2.10 × 107 hm2 of land from other provinces, with arable land, forestland, and grassland accounting for 25, 61, and 14%, respectively. Guangdong’s utilization of ESV is mainly dependent on external inflows, with minimal local consumption and outflows. The embodied ESV between Guangdong and other provinces is 1626.10 billion yuan, with an outflow of 325.32 billion yuan. The “Y”-shaped region consisting of the northwest, northeast, southwest, and Hainan bears significant potential ESV losses for Guangdong Province. Population growth and the intensity of ESV loss will promote the flow of cropland and forestland ESV, while economic development has a certain inhibitory effect on ESV transfer. This paper provides a new analytical perspective on issues such as the spatial distribution mismatch of land resources and ecologically unequal exchange. These insights are pivotal for promoting sustainable utilization of land resources and regional equity.

Exploring global embodied carbon emissions transfer network—An analysis based on national responsibility

This paper explores the global embodied carbon emissions transfer network. To clarify the carbon emissions reduction responsibilities of each country globally, a complex interdependent network structure based on the 2016 World Multi-Regional Input-Output (MRIO) table and the transfer of production factors between industries is constructed. Using input-output and social network analyses, the structural features of the global carbon emissions flow network is uncovered, and then carbon inequality among countries from a multi-regional perspective is revealed. The research findings show that the scale of global embodied carbon transfer expands continuously. The direction of transfer exhibits asymmetry, regionalism, and complexity. Hungary, Romania, Slovenia, Iran, Ethiopia, and Iran are the main carbon-exporting countries, while the United States, Germany, the United Kingdom, Japan, Canada, Spain are the main carbon-importing countries. Furthermore, the block model analysis reveals that the carbon transfer and transmission effects between global regions tend to be centralized clusters, from “demand-driven” to “internalized supply-demand coexistence”. There is significant uneven exchange between wealth benefits and environmental burdens among blocks.

Building a baseline to better integrate air passenger and air freight transport into a global Computable General Equilibrium (CGE) model

The Covid-19 pandemic has had opposite effects on demand for air passenger and air cargo transport and on the way these two sectors interact with other sectors of the economy. However, macroeconomic models generally represent aviation as a single sector, limiting the ability to assess those interactions. In this study, we split the air transport sector into two sectors (passenger and freight) in GTAP’s Multiregional Input–Output table. We assess the sectors’ response to a carbon tax by performing a sensitivity analysis. Our results highlight the environmental benefits from the Covid-19 pandemic will only be transitory unless policies and consumer demand rein in traffic growth in the aviation industry. Particular attention should be paid on leisure travel, due to its large share in the aviation industry and the potential steep rise in demand (87%) in the EU27 projected between 2015 and 2030.

The impact of global value chain restructuring on the product structure of China-EU exports

Using the Asian Development Bank Multi-Regional Input-Output Tables (ADB-MRIO) and the UIBE GVC Indicators Database, this paper selects the data of 14 manufacturing industries in China from 2007 to 2020, and empirically studies the impact of global value chain restructuring on the product structure of China-EU exports. Research shows that the restructuring of global value chain is conducive to the optimization of China-EU export product structure, and has a stronger effect on high-tech industries. Among them, the labor cost-driven global value chain restructuring is not conducive to the upgrading of China-EU export product structure, while the technological progress-driven global value chain restructuring is helpful to the upgrading of the product structure of China-EU exports. Further research finds that the global value chain restructuring driven by the US trade protection policy is conducive to the upgrading of China-EU export product structure. The research of this paper is helpful for China to strengthen China-EU cooperation and upgrade export trade structure in the new wave of global value chain restructuring. This paper can provide a possible path for China and other developing countries to explore high-quality economic development and provide relevant reference value for policy formulation related to the establishment of long-term trade cooperation with the EU.

Modifying national industrial structure for reducing heavy metals in China: A nexus-based multi-objective optimization approach

Heavy metals (HMs) exhibit significant toxicity and can lead to a range of health issues. Certain HMs share common emission sources, necessitating an exploration of the nexus among various HMs for achieving collaborative reductions. Considering the efficacy and feasibility of industrial modification to environmental pressures, this paper proposes a novel nexus-based optimization approach based on nexus analysis, multi-region input-output (MRIO) table, and multi-objective optimization to mitigate atmospheric HMs. The atmospheric HM emission inventory in 2017 is first compiled. Subsequently, the Integrated Nexus Strength of HMs Risk (HMR-INS) is proposed and employed to determine the range of sectoral output variations. Finally, a multi-objective optimization approach is employed based on the MRIO table in 2017. Compared with the traditional optimization method, the proposed approach performs better regarding HM-related risks and total output, leading to a 1.9 million tons increase in reduction on HM-related risks and a 1.37 trillion yuan increment in total output. Some further analyses are also given to provide feasible solutions for industrial modification, which considers both the economic efficiency and the stability of the industrial structure.

Tracking household carbon inequality in China: Composition effect or coefficient effect?

Reasonable allocation of carbon emission reduction tasks requires addressing household carbon inequality. This study aims to track characteristics of household carbon inequality in China using the recentered influence function (RIF) based on the Household Tracking Survey data in 2018 and the multi-regional input–output table. The Oaxaca–Binder decomposition based on RIF further decomposes household carbon inequality based on spatial heterogeneity into composition and coefficient effects. The results indicate that (1) household carbon inequality is widespread in China, generally close to the 60/30 distribution, favouring high-income families. Furthermore, (2) increases in income, wealth and economic burden and declining marriage rate promote household carbon inequality, which is suppressed by the development of education and the Internet and the increase in car ownership. Additionally, (3) the carbon inequality of urban households is smaller than that of rural households, which is contributed by the composition effects of family size, education, car ownership, Internet development and the coefficient effect of income and housing. Finally, (4) under the composition effect of family size and the coefficient effect of income, the household carbon inequality in the eastern region is smaller than in the central and western regions.

Unequal prefecture-level water footprints in China: The urban-rural divide

Water is vital for inclusive human well-being and economic growth, but water and its benefits are not equally distributed to all. The water gap between city dwellers and rural folks was not well understood. In this paper we assessed prefecture-level urban and rural water footprints (WFs) in China, using an improved multi-region input-output (MRIO) table with resolved urban and rural final consumption data. The assessment provided a quantitative foundation for evaluating and explaining urban and rural water use inequality from the consumption perspective. The results showed that per capita urban WF was on average 2.1 times per capita rural WF. The urban-rural WF divide constituted an important contribution to spatial WF inequality, in addition to provincial-level and prefecture-level differences. Compared to previous provincial-level WF analyses, this high-resolution prefecture-level urban and rural analysis showed clear evidence of economically developed urban areas as hotspots of large WFs. Specifically, our results provided a quantitative assessment revealing that 10 % China's population (urban residents in 51 prefectures) appropriated 25.8 % of the national WF. The dominant driving factor for urban-rural per capita WF disparity in all the prefectures was the consumption level, accounting for on average about 84 % of the disparity. There is an urgent need to leverage socio-economic development and urbanization against equitable and sustainable water use. The results have implications to equitable and sustainable water management from a broader macro-economic view.

The European regions in the global value chains: New results with new data

AbstractThis article contains the methodology and main results related to the update and extension of the widest interregional input–output tables for the entire EU27, UK and the European Free Trade Association (EFTA) countries. This work continues the outstanding effort developed in the past years regarding the estimation and analysis of different multiregional input–output (MRIO) databases at the country level (world input–output database, EXIOBASE, ICIO, FIGARO, etc.) and the MRIO tables developed for the European Union (EU) at the NUTS2 level. The main contribution consists of updating and extending the current EUREGIO collection to obtain a EUREGIO table for 2017, which will be referred (NUTS‐2 Rev.2016) for all the EU27 + UK + EFTA countries and will be embedded in the new FIGARO multicountry 2017. Such effort was developed in the context of the ESPON‐IRIE project. This article summarises the methodology used and compares the results obtained with the ones of the main benchmarks, providing an analysis of the national and regional participation in the global value chains (GVCs). The main results suggest that, on average, 65% of value added is embodied in the goods and services sold to the same NUTS‐2 region, 16% is embodied in the ones sold to regions in the same country and the remaining 20% is exported (to other countries). Exploring the heterogeneity within these figures can also be seen that the variety is higher across regions than across sectors. Our analysis suggests that, to a large extent, the heterogeneous participation of EU27 + UK + EFTA regions in the GVCs is explained by their sectoral structure more than by the regional idiosyncratic characteristics. Such results open the floor for the correct design of industrial policies, embedded in the smart specialisation paradigm.

The economy–employment–environmental health transfer and embedded inequities of China's capital metropolitan area: a mixed-methods study

Metropolitan areas have complex trade linkages internally and externally. This complexity stimulates the unequal spatial transfer of environmental health consequences, economy, and employment embodied in internal trade or trade with the outside regions, resulting in unequal exchange. Existing research has rarely discussed this issue at a refined scale, hindering targeted inequity alleviation policies. We conducted a mixed-methods study, focusing on the most polluted metropolitan area in the world, the Beijing-Tianjin-Hebei region of China, and developed an integrated modelling framework to downscale the analysis of the trade-driven unequal transfer of PM2·5- related premature deaths, value added, and job opportunities to the city scale within Beijing-Tianjin-Hebei. The study couples a nested Multi-Regional Input-Output model table containing data from 13 Beijing-Tianjin-Hebei cities and 28 outer provinces in 2017 with a bottom-up emission inventory, value added and employment statistical data, the Weather Research and Forecasting-Comprehensive Air Quality Model with Extensions, the Global Exposure Mortality Model, and human capital methods. We also constructed two indices measuring unequal exchanges between PM2·5-related deaths and economic and employment gains embodied in trades between cities in Beijing-Tianjin-Hebei and trades with outside regions. The Beijing-Tianjin-Hebei region as a single entity shifted 14 985 (95% CI 12 800-16 948) net deaths to regions outside the Beijing-Tianjin-Hebei through trade, most of which occurred in the central region of China. The industrial-based peripheral Beijing-Tianjin-Hebei cities suffered the most serious inequities when trading with other Beijing-Tianjin-Hebei cities and outside regions. While gaining equivalent local jobs, these industrial-based peripheral cities had 250% higher PM2·5-related deaths (10·2 PM2·5-related deaths for obtaining 1000 local jobs) than core cities (2·9 PM2·5-related deaths for obtaining 1000 local jobs) and 57·7% higher PM2·5-related deaths than agricultural-based peripheral cities (6·5 PM2·5-related deaths for obtaining 1000 local jobs). While gaining equivalent value added, industrial-based peripheral cities had 50·6% higher PM2·5-related deaths (¥13·9 of reduced human capital due to PM2·5-related premature deaths to obtain ¥1000 local value added) than core cities (¥9·2 of reduced human capital due to PM2·5-related premature deaths to obtain ¥1000 local value added) and 67·4% higher PM2·5-related deaths than agricultural-based peripheral cities (¥8·3 of reduced human capital due to PM2·5-related premature deaths to obtain ¥1000 local value added). Treating metropolitan areas as a single entity obscured internal heterogeneity, potentially misleading policy makers into imposing strict regulations on the whole metropolitan area to alleviate the inequities it posed on outside regions. However, several peripheral Beijing-Tianjin-Hebei cities were disadvantaged in their trade with core Beijing-Tianjin-Hebei cities and outside regions. Therefore, policies should be tailored for particular cities within metropolitan areas. Future targeted policies should include, but not be limited to, making ecological compensations and incorporating the environment and health costs into the price of pollution-intensive goods and services. National Key Research and Devlopment Program of China, National Natural Science Foundation of China, and Jiangsu Natural Science Foundation.

Regional economic analysis of major areas in South Korea: using 2005–2010–2015 multi-regional input–output tables

South Korea’s Seoul metropolitan area accounts for more than half of the country’s GDP and population. This phenomenon is exacerbating annually. Regions outside the metropolitan area of Korea are not only decreasing in terms of economic size, but are also becoming more dependent on the metropolitan area in terms of economic structure. Earlier, the metropolitan area was based on the service industry, while other regions had a large manufacturing sector; however, the size of the latter also increased in the metropolitan area over time. To analyze dependence on the Seoul Metropolitan area, this study conducts regional production inducement effects, regional division of labor, and three regional structural decomposition analyses using Korea’s 2005–2010–2015 multi-regional input–output table (MRIO) to further analyze dependence on the metropolitan area. Furthermore, this research integrates industry classification and realizes the price level of input–output tables to link 3 years of MRIO in three industries: wholesale and retail trade and product brokerage services, motor vehicles, semiconductors, and other electronic components. From the inter-regional production inducement effect, the relation between the metropolitan area and each region is calculated using the regional export and import effects of each region. Furthermore, the proportion of metropolitan areas in major industries and their changes are measured through regional division of labor, and through multi regional structural decomposition analysis, the growth factors of each region over 10 years are determined by own region, metropolitan area, and other regions.

Green technology diversification, technology vertical spillovers, and energy intensity in Chinese cities

Drawing from patent data spanning 2011-2016 in 249 Chinese prefecture-level cities and urban scale multi-region input-output (MRIO) table data, this paper empirically demonstrates that as green technological diversification levels escalate, the energy intensity of Chinese prefecture-level cities exhibits an initial increase followed by a decline. Green technological diversification indirectly influences urban energy intensity through vertical spillovers of green technology across the upstream and downstream sectors within the supply chain. Medium-sized cities, service industry-oriented cities, and those in the early stages of industrialization need to prioritize development of multiple green technologies to surpass the diversification turning point. The finding suggests a strategic transition for Chinese cities from a single green technology agglomeration model to a cluster model of collaborative development of multiple green technologies.