Regional Input-output Model Research Articles

Estimating the global production and consumption-based water footprint of a regional economy

The current scenario of increasing use and pollution of water resources and the effects of climate change on natural supply coexist with a high trade interconnection, where impacts are transmitted from local to global scales. Identifying and quantifying these impacts is essential to focus and coordinate policies for sustainability. In this context, this study develops a methodology to estimate the pressures of a regional economy on global water resources. Unlike previous studies, which have focused mainly on the regional and national blue water footprint (WF) of consumption, the proposed framework integrates in an innovative way: i) an estimation of the global green, blue and grey WF, ii) a comparison between production and consumption-based approaches, iii) a spatial disaggregation, and iv) a scarcity-based assessment. Specifically, a regional input-output (IO) model and a global multiregional IO model are used, which allows identifying the origin and quantifying the water incorporated in imports. The Tuscany region in Italy is considered as a case study, where the domestic WF has been studied, but global impacts on water resources are unknown. The results show that, although 42.7 % of Tuscany's imports come from outside Italy, the pressures on water resources exerted abroad represent 81.2 % (production) and 73.4 % (consumption) of total. This result is amplified when only water incorporated under scarcity conditions is considered, reaching 96.3 % (production) and 94.6 % (consumption). The proposed approach allows characterizing the most significant impacts, which could guide policies to promote the consumption and import of products with low water incorporated under stress conditions.

Impact of COVID-19 on the economic loss and resource conservation of China's tourism industry from the supply chain perspective

The travel restriction leads to the enormous economic loss to the tourism industry. In this paper, the economic loss and the environmental gains (e.g., water and energy resources) from COVID-19 impact on China's tourism industry are estimated based on environmentally extended multiple regional input-output model. Results indicate that the China's tourism consumption loss triggered 921 billion US$ output loss via supply chain in 2020, which account for 7 % of GDP in 2019. Additionally, the economic loss further ripples tourism water footprint conservation of 10 billion m3 (equal to the annual water consumption of Poland) and tourism energy footprint conservation of 116 million tce (equal to the annual energy consumption of Australia). Findings reveal that regions with large tourism economic losses are not completely consistent with the regions with significant relief of water and energy pressures. Water pressure in Xinjiang (Northwest) and energy pressure in Hainan (South) have been alleviated due to reduced tourism consumption along the Southeast coast. These knock-on effects highlight a deeper internal link between the economy and the environment. The development of tourism in the post-COVID-19 era needs to reduce the direct water and energy footprint of local area by applying advanced water-saving and energy-saving technologies.

Economic impact of resident and nonresident marine anglers to the local economy in Mecklenburg‐Western Pomerania, Germany

AbstractRecreational fisheries catches are increasingly considered in the assessment and management of mixed recreational‐commercial marine fisheries, while the contribution of recreational fisheries to the economy is often overlooked. Using a telephone diary survey targeting marine recreational anglers in Germany, we estimated the number of anglers and their expenditures over the course of 1 year (2014–2015). About 197,000 marine anglers spent €248 million in Germany. We then constructed regional input–output models and contrasted the economic impacts of resident and nonresident anglers fishing in coastal and transitional brackish waters of the state of Mecklenburg‐Western Pomerania in north‐eastern Germany. On a regional scale, the total economic impact was €210 million supporting 2044 jobs, nonresident anglers were responsible for eight times greater economic impact than resident anglers. Maintaining attractive fishing opportunities for the recreational fishing sector, specifically angling tourism, is critical for maintaining resource flows to local and regional economies.

Exploring Water Use in Mildly Water-Scarce Regions: A Structural Decomposition Analysis for Anhui Province in China

Because of severe water scarcity, it is crucial to quantify water use in China’s water-scarce regions and to analyze the factors driving its use. In this paper, we analyze the driving factors behind the water footprint from 2007 to 2017 in the mildly water-scarce region of Anhui Province, using regional input–output models and structural decomposition analysis. The results show the following: (1) Although the average virtual water intensity of Anhui Province decreased by 52.58% from 2007 to 2017, the water-use efficiency was still low; (2) During the study period, the total water footprint of Anhui Province increased by 25.06%, with an obvious upward trend; (3) From 2012 to 2017, the net export volume of virtual water in Anhui Province was positive, and the flow volume decreased by 78.87%; (4) Technological progress contributed the most to reducing the water footprint of Anhui Province, followed by the increased counter-urbanization rate as the second-largest driving force. The expansion of the scale effect, including the size of the economy and the size of the population, was the main negative driving force for the increase in Anhui’s water footprint. However, the proportion of economic scale in the water footprint drivers gradually decreased.

A regional input-output model of the COVID-19 crisis in Italy: decomposing demand and supply factors

We propose an empirically estimated inter-regional input-output model of the Italian economy designed for COVID-19 impact assessment, intended as a tool for public authorities facing comparable adverse events and requiring timely estimates of sectoral and regional economic impacts. We evaluate the contributions of demand- and supply-side factors to output losses in Italy during the pandemic, providing insights on the suitability of demand- and supply-side policies. Supply-side shocks, as a consequence of mandated closures, are the primary driver of output losses only during the nationwide lockdown of spring 2020. During the following stages, changes in final demand due to income losses and changes in mobility play a pivotal role at the aggregate, regional, and sectoral levels. While this result supports demand-side policies, the efficacy of such policies may be hampered when final consumption demand is low chiefly due to reduced mobility rather than income losses.

A Comparative Analysis of Spillover Effects on Surrounding Cities of Beijing And Shanghai

Industrial linkage is the key channel for spillover effect, and improving the spillover effect of central cities is an important task to realize the coordinated development of regional economy. From the perspective of industrial linkages, this paper uses the 2017 China's Inter-city input-output table to build a three regional input-output model to compared with the two-way overflow between Beijing and surrounding cities and the two-way overflow between Shanghai and its surrounding cities. The research findings are as follows: 1. Central cities and cities with higher economic development level have higher two-way spillovers, and the two-way spillover effect between Beijing and surrounding cities is smaller than that between Shanghai and surrounding cities; 2. There is an imbalance between central cities and surrounding cities in value-added gains. Beijing Tianjin Hebei and Yangtze River Delta present different situations. The share of spillover effects in GDP of surrounding cities to Beijing is generally small, and Beijing's value-added spillover to surrounding cities is greater than that of surrounding cities to Beijing. The share of spillover effects in GDP of surrounding cities to Shanghahi is generally high, and most of the surrounding cities' value-added spillovers to Shanghai are greater than Shanghai's value-added spillovers to the surrounding cities. 3. In terms of industry, Beijing and Shanghai have the largest added value spillover in the tertiary sector, followed by the secondary industry, and the value-added spillover of the primary industry is the smallest; From the perspective of 42 industry sectors, Beijing and Shanghai are relatively consistent in industries with large spillover effects on surrounding cities, which are the dominant industries of Beijing and Shanghai, and are concentrated in the secondary and tertiary industries. 4. Compare the value-added spillover effect of Shanghai and Beijing on urban agglomeration as a whole. The per capita spillover effect of Beijing on Beijing Tianjin Hebei is smaller than that of Shanghai on the Yangtze River Delta. Finally, according to the research conclusions, starting from the regional industrial advantages, it provides relevant policy recommendations for regional development and promoting the high-quality development of regional integration.

Development of a Regional Input-output Model for Environmental and Socio-economic Assessment of Renewable Energy

本研究では，地域における再生可能エネルギー技術の導入がもたらす環境・社会経済効果を評価するための再生可能エネルギー部門拡張産業連関モデル・地域版（Renewable Energy Focused Input-Output model for Region: REFIORegion）を開発している。REFIO-Regionの作成は次の２段階のプロセスで構成されている。第一に，国と47都道府県の産業連関表，経済センサス活動調査など各種統計を用いて，1,741 市区町村の産業連関表（地域内表）を作成している。 第二に，1,741市区町村を任意の２地域に分類して２地域間表とするとともに，12種の再生可能エネルギー技術に関わる部門を結合することで，２地域間産業連間モデル，すなわちREFIO-Regionを構築している。REFIO-Regionは，わが国の1,741市区町村の産業構造ならびに12種の再生可能エネルギー技術の技術構造を詳細に表現しており，各技術の地域レベルの導入効果を詳細に分析可能である。REFIO-Regionを用いて，18市町村で構成される熊本連携中枢都市圏に風力発電を導入した場合の地域経済効果についてケースタディを実施している。ケースタディの結果は風力発電と導入地域の特徴を反映したものとなっており，本モデルの有効性を示している。

Effects of COVID-19 on Adriatic and Continental Croatia tourism: a regional input-output perspective

The purpose of this article is to estimate regional economic impact of tourism in Croatia. Rich cultural heritage and natural resources are factors which have contributed to the rapid increase in tourist arrivals in Adriatic Croatia, especially after the removal of all barriers to free movement following Croatia’s admittance to the European Union. While tourism is one of the key sectors which has contributed to Adriatic Croatia’s growth and development, a high share of tourism in gross value added and employment has increased the region’s vulnerability to external shocks, such as the outbreak of COVID-19 pandemic in 2020. The estimation of tourism’s role in Croatia’s regions is based on the regional input–output model, which identifies total effects of tourist demand. Results of the study reveal structural differences in Croatia’s regional growth path. While Continental Croatia specialises in more sophisticated industrial sectors, the economy of the Adriatic region is strongly dependent on tourism. The decrease in tourist arrivals due to COVID-19 travel restrictions resulted in a significant decline in economic activity in Adriatic Croatia. Economic activity in the hospitality sector was most affected by decreased demand, but other sectors which deliver inputs required for tourism services were also significantly impacted.

Limited impact of COVID-19 recovery packages on near-term CO2 emissions pathways

Part of the economic recovery plans implemented by governments following COVID-19 is directed towards the energy transition. To understand the potential effects of these post-COVID green recovery packages on reductions of global greenhouse gas emissions until 2030, we investigated three different approaches. First, we analyzed simulation results of Integrated Assessment Models (IAMs) to infer the change in CO2 intensity of GDP that could result from post-COVID low-carbon investment plans. Second, we investigated the scenarios the International Energy Agency (IEA) provided based on a bottom-up energy system model. Combining the two approaches, we found that green recovery packages implemented and planned globally can lead to an emissions reduction of merely 1%–6% from the 2030 baseline levels at most. Third, we looked into the results of the Adaptative Regional Input-Output model, which simulates the dynamic effects of economic crisis and fiscal stimuli through supply chains following labor shortage. The third approach shows that the increase of activity driven by fiscal stimuli leads to a rebound of CO2 emissions even if they do not target carbon-intensive sectors. We conclude that green recovery packages targeting low-carbon technologies have a limited impact on near-term CO2 emissions and that demand-side incentives, as well as other policy efforts to disincentivize the use of fossil fuels, are also crucial for scaling up climate mitigation.

A Study on Inter-Provincial Environmental Pollution Movement in China Based on the Input–Output Method

In China, environmental pollution responsibilities are divided according to administrative regions. However, because of the strong externality of environmental pollution, the movement of environmental pollution undoubtedly increases the complexity of pollution governance. To divide the responsibility of environmental pollution governance in each province, we effectively quantify the unequal relationship between environmental pollution costs and economic benefits in each province to understand the mechanism and characteristics of inter-provincial environmental pollution movement. Based on the regional input–output model and an inventory we compiled of sulfur dioxide(SO2) emissions of air pollutants in 2012, we calculate the implied inter-provincial environmental pollution emissions and economic benefits from trade, based on production and consumption (supply-side and demand-side). In addition, the movement relationship is explored, and the cost and economic value-added indexes of air pollution control are further constructed to provide effective evidence for a reasonable division of responsibility for environmental pollution control. The results show that there are obvious environmental inequities in the regional trade process in each province, indicating that environmental pollution has been moved. Developed provinces have more economic benefits but pay less in the process of trading goods with less-developed provinces due to the advantages of their industrial structure, while the opposite is true for less-developed provinces. Finally, we propose corresponding policy recommendations to change this condition.

Where Have Carbon Emissions Gone? Evidence of Inbound Tourism in China

Tourism is emerging as an important contributor sector to carbon emissions. As inbound tourism is the main component of tourism activities, measuring and evaluating the carbon footprint of inbound tourism can help achieve low-carbon development of the global tourism industry. Based on the carbon footprint theory, this study describes the distribution and transfer path of China’s inbound tourism carbon footprint by using the China multi regional input-output model embedded in the inbound tourism satellite account. The results reveal that embodied carbon emissions (ECE) of inbound tourism is higher than direct carbon emissions, and carbon emissions intensity is close to the average economic. Therefore, it is difficult for inbound tourism to achieve the dual goals of stimulating economic growth and emission mitigation. The ECE of inbound tourism has obvious inter-provincial transfer characteristics. Inner Mongolia and Guangdong are the largest provinces with net outflows/inflows of ECE, with net outflows of 1.47 million tons and inflows of 2.66 million tons. Besides, the ECE mainly flows from the northeast and northwest regions to the southern and eastern regions. From the perspective of industry transfer, 72.2% of ECE of inbound tourism comes from the power sector.

The economic impact of long-term care services

Abstract Projections show sharp increases in public spending on long-term care (LTC) services across Europe. However, a purely cost-based focus on LTC services is economically misleading. Private and public expenditure on LTC services directly and indirectly generates income in the form of salaries, taxes, and social security contributions. The aim of this paper is to quantify the economic impact and multipliers of LTC services for Austria. Based on an econometric regional Input-Output model for Austria, we estimate the direct, indirect, and induced effects of public and private expenditures on value added, employment, taxes, and social security contributions. According to our results, each euro spent on LTC services is associated with domestic value added of € 1.70; 70 cents per euro spent flows into public budgets in the form of taxes and social security contributions. The economic multipliers of the LTC services are comparatively high due to the high share of wages and salaries in direct expenditure and the associated high direct value added. Public expenditure on professional care services should therefore not be regarded merely as a cost factor in the public budget. Rather, this rapidly growing economic sector is also an increasingly important economic factor in a time of ageing societies. While the model does not provide information on the causal economic effect of the LTC sector, the findings are still highly important for planners of LTC reforms, as they provide information on the total value added associated with LTC expenditures and on the total number of jobs that these expenditures sustain.

Carbon footprint and embodied carbon emission transfer network obtained using the multi–regional input–output model and social network analysis method: A case of the Hanjiang River basin, China

China is the largest carbon emitter in the world; thus, reducing carbon emissions while maintaining economic growth has become an important issue. Within the context of carbon neutrality strategies, calculation of the carbon footprint and embodied carbon transfer can help policymakers formulate reasonable carbon reduction plans. The multi–regional input–output (MRIO) model can clarify carbon flow pathways between regions, and social network analysis (SNA) can comprehensively evaluate the different positions of individual sectors. Combining these two approaches, the specific characteristics of carbon emissions in complex production and trade relationships can be analyzed. China has become the world’s top total carbon emitter, and the Hanjiang River basin (HJRB) constitutes an important economic link between the developed and less developed regions of China. Studying carbon emissions in the HJRB can provide a reference for other, similar regions and is vital for the realization of China’s carbon emission reduction targets. This paper examines the carbon footprint and embodied carbon emission transfer among three provinces and 12 sectors in the HJRB during different periods and identifies the key industries in the carbon transfer process. The results indicate that (1) the total carbon footprint in the HJRB exhibits an increasing trend. Energy-based Shaanxi Province exhibits the highest growth rate of the carbon footprint, agriculture-based Henan Province shows a decreasing trend, and consumption-based Hubei Province displays the lowest carbon footprint intensity. (2) There are differences in the carbon emission coefficient and final consumption rate among various sectors; construction, metal processing and metal and non-metallic products, processing and manufacturing of petroleum, coking, nuclear fuel, chemical products, and other services are the sectors accounting for a high proportion of emissions. (3) The more obvious the supply relationship is, the higher the flow of embodied carbon emission transfer between sectors. (4) Energy-based regions transfer large amounts of fossil energy, electricity, steel and coal resources to developed regions and simultaneously assume more of the carbon reduction pressure imposed on developed regions. (5) The key industries within the embodied carbon emission transfer network notably control the carbon emissions of other industries and can provide breakthroughs to achieve challenging carbon emission reduction targets.

Assessment of Sectoral Virtual Water Flows and Future Water Requirement in Agriculture Under SSP-RCP Scenarios: Reflections for Water Resources Management in Zhangye City

Water scarcity is a core issue that constraints the high-quality development of arid areas in northwestern China. Zhangye is an oasis city located in the Heihe River Basin in northwestern China. It is populated with an agriculture-dominated economy and faces more and more serious water crises. Virtual water is an indicator that can measure the embodied water in the traded products, which has been widely applied for making rational policies for water resources management. In addition, clarifying water requirements in agricultural sectors under future climate change scenarios is essential to develop more appropriate adaptation strategies. From this perspective, this study aims to evaluate and compare virtual water flows among various sectors in Zhangye for the years 2012 and 2017 with a single regional input-output model and to further clarify the future water requirement tendency in agriculture during 2020–2050 under different shared socioeconomic pathways and representative concentration pathways (SSP-RCP) scenarios. The results showed that the planting sector directly contributed most of the total water consumption with the highest direct coefficient of 3307.5 m3/yuan in 2012, whereas the manufacture of food products and tobacco processing sector had the largest proportion of indirect water consumption (99%) mainly from intermediate inputs of agricultural products. Water consumption intensity of all sectors on average decreased by 22% during 2012–2017, indicating an increasing water utilization efficiency in economic industries. Household consumption also can improve water utilization efficiency as the major pathway for final consumption (86.4% in 2017). Water scarcity in Zhangye was becoming increasingly prominent since virtual water net exports were higher than local consumption, especially in the agriculture, manufacturing, and energy supply industries. Moreover, under climate change scenarios, we found the highest level of water requirement per unit area occurred in 2000, but it still had an incremental potential by 2050, especially in SSP585. The high requirement intensity and large-scale maize planting caused a rising tendency of total crop water requirement with an annual increasing rate of 8.4% from 1980 to 2050. This makes it possible to adapt to climate change through scientific management measures and technical means. We further made policy implications for adaptive management of water resources in Zhangye.

The perceived effectiveness and hidden inequity of postpandemic fiscal stimuli

The world has committed trillions in fiscal expenditures to reboot the economy in the post–COVID-19 era. However, the effectiveness and the equity impacts of current fiscal stimuli are not fully understood. Using an extended adaptive regional input–output model, we assess the short-term impacts (2020 through 2022) of feasible stimuli on the global economy and the labor market. Our findings show that the stimuli pledged by 26 countries, i.e., 2.4 trillion euros in total, are effective in keeping the recession short and shallow by saving 53 million to 57 million jobs (compared to the no-stimulus scenario). However, the stimuli exacerbate income inequity at the global scale if we define “equity” as those who suffer more from the pandemic should receive more assistance. Low-skilled workers in these countries, who suffer more from the pandemic than high-skilled workers, benefit 38 to 41% less from the job-creation effects of the current fiscal stimuli. As an alternative, low-carbon stimuli can achieve a balance between effectiveness and equity at the global level. Low-carbon stimuli save 55 million to 58 million jobs and decrease income inequality by 2 to 3% globally compared to the currently pledged stimuli. Country-level situations are more complicated, as modifying the current stimuli to achieve more “greenness” brings win–win in effectiveness and equity in some countries, while in the others, more greenness and equity are at the expense of less job savings. Our findings underscore the need to consider the overlooked trade-offs between effectiveness, equity, and greenness, both globally and nationally, when designing further postpandemic fiscal stimuli.

Labour productivity and regional labour markets resilience in Europe.

This paper conceptualizes and empirically explores the resilience of European Union regional labour markets in terms of labour productivity growth. We assess the effect of pre-crisis region-specific factors on regional labour markets resilience controlling for the effect of exogenous technological change and substitution between capital and labour. Regional input–output models are developed to estimate supplies and sales linkages across the European Union NUTS-2 regional economies. Spatial Durbin Error Model estimates suggest that regional labour markets characterised by a higher level of economic pull capabilities of the Construction sector and a higher level of industrial concentration can better withstand the effects of the negative shock and recover faster. Place-based policies building on regions’ competitive strengths can smooth out the negative effect of the economic shock and accelerate the recovery of regional labour markets, while policy interventions promoting capital investment can further enhance labour productivity in European Union regions.

Economic and regional spillovers of energy efficiency investments in buildings

This paper explores whether the policy of mitigating climate change through energy-efficient retrofitting supports more balanced development or increases regional disparities. The issue is explored through the estimation of the socioeconomic effects of energy-efficient renovation across Croatian regions. The regional input–output model is applied to identify direct, indirect, and induced effects of building retrofit investments on gross value added and employment. In the Croatian case, over three-quarters of the total economic effects of energy-efficient retrofitting is distributed to the more developed region of Continental Croatia. Economic activity in the Adriatic region is strongly dependent on tourism with insufficient local production of the manufacturing products required in energy renovation projects, and a certain proportion of spillover effect of the investment is transferred to Continental Croatia. The positive economic effects induced by retrofit investments are most present in construction, manufacturing, trade, and transport. Results suggest that climatic conditions and regional economic specialisation have an impact on the dispersion of the economic effects of retrofit measures in different regions.

Comparing Bioeconomy Potential at National vs. Regional Level Employing Input-Output Modeling

The support of economic sectors that exploit natural bio-based resources in a particular region is an opportunity to benefit from local potentials in terms of sustainability, employment, output, and household income. Hence a relevant question emerges, namely, how can bioeconomy sectors be adequately supported? Within this context, another issue is whether the bioeconomy development strategy at a national level should be the same as that at a regional level. To address these issues, in the current study a comparison was made between the bioeconomy sectors at the country level based on the case study of Poland and one of the poorest regions in the European Union—the Lubelskie Region. A regional input–output model was built for the regional economy and compared with the national model. The bioeconomy-oriented regional input–output table was built by applying a hybrid regionalization method, combining non-survey techniques and a questionnaire survey that was carried out in companies of mixed bio-based sectors. Sectoral linkages, such as multipliers and elasticities, indicate notable differences among the bio-based sectors’ potentials of the regional and national economies. Therefore, a bioeconomy development strategy should be seen to differ at national and regional levels.

The Paradox of the Virtual Water Trade Balance in the Mediterranean Region

Climate change, water shortages and desertification threaten the economic and environmental sustainability in the Mediterranean. Limited rainfall and higher temperatures put agricultural production, which relies on water availability, in jeopardy. Thereupon, Mediterranean countries pursue agri-food resilience and water preservation through efficient water policies. Hence, water-deprived areas ought to import rather than produce water-intensive products to maintain water inventories and sustainability consequently. As this study examines the water sustainability for a Mediterranean water-scarce region with a particular focus on agriculture, the virtual water trade balance explores this hypothesis. A regional input–output model is constructed, and then total water consumption and the virtual water flows for each economic sector are estimated to determine the virtual water trade balance of the economy. Results indicate that the study area has a trade deficit and struggles economically but is a net importer of virtual water and secures water sustainability. As this virtual water deficit relies heavily on agriculture and originates in vast total water consumption rather than a large trade deficit, a paradox occurs; water-intensive cultivations and animals that consume 91.75% of water resources end up appearing to be water-saving. Further research is needed to strike a balance between economic growth and environmental protection.

Restoring the Social Balance: The Potential Impact of a Public Infrastructure Bank

: This article shows how regional input-output modeling can be used to estimate the economic impact of a proposed public bank in the City of Philadelphia and a State Bank of New Jersey. Empirical analysis estimates the positive increase in output, earnings, employment, and value-added for each newly proposed public bank. In New Jersey, state output could rise by over $54 billion and over 243,000 new jobs could be created. In Philadelphia, gross city product (value-added) could rise by $3 billion and nearly 11,000 new jobs are projected.