Handbook of Input–Output Analysis
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Handbook of Input–Output Analysis

Edited by Thijs ten Raa

In this authoritative Handbook, leading experts from international statistical offices and universities explain in detail the treatment and role of input-output statistics in the System of National Accounts. Furthermore, they address the derivation of input-output coefficients for the purpose of economic and environmental modeling, the building of applied general equilibrium models, the use of these models for efficiency analysis, and the extensions to stochastic and dynamic input-output analysis. As well as revealing and exploring the theoretical foundations, the Handbook also acts as a useful guide for practitioners.
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Chapter 9: Environmental economics

Kim Swales and Karen Turner

Abstract

The basic input-output model is first extended by differentiating industry outputs by region. The consequent interregional input-output matrix accounts for pollution footprints of final consumption, possibly even including household income effects, which further boost output and pollution. Another extension is the internalization of cleansing activities, to account for the social cost of emissions. Attempts at full integration of production and environmental accounting, following the "materials balance principle," are critically examined. Other environmental analyses follow. Water satellite accounts facilitate the analysis of water trade. Waste input-output models integrate waste creation and management options so that waste can be tracked. Energy efficiency improvements reduce costs, which in turn boosts demand for energy: the rebound effect. The rebound effect is related to the input-output multipliers that include the household consumption effects. The extension to general equilibrium analysis is introduced.

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