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GTAP Resources: Resource Display

GTAP Resource #6604

"Beyond production and consumption: using throughflows to untangle the virtual trade of externalities"
by Beaufils, Timothé, Etienne Berthet, Hauke Ward and Leonie Wenz

Understanding how countries contribute to the generation of externalities globally is important for designing sustainable policies aimed at reducing negative externalities such as carbon emissions.
Commonly used approaches focus on either producers or consumers, thereby neglecting the role of intermediates.
We here introduce the concept of throughflow to comprehensively quantify externalities generated by the supply chains either originating from, passing through or ending in a given country. This Throughflow Based Accounting (TBA) framework provides an overview of the quantity of externalities a country could potentially target through the supply chains it is directly involved in.
Focusing on one country, we illustrate the strength of the TBA by demonstrating that it identifies two times more CO2 emissions related to the German economy than usual production- or consumption-based accounting frameworks. We argue that Germany could use its position in global value chains to help reduce CO2 emissions globally.

In a broader approach, the TBA is built on Multi-Regional Input-Output Table (MRIOT) and can be directly used for further Global Value Chain (GVC) analysis.
More particularly, it can be used to measure different indicators based on the origins of value-added:
1. in gross exports and imports;
2. by source country and industry.
For the indicators based on the origins of value-added in gross exports and imports, the TBA can be used to calculate the re-imported domestic value-added content of gross exports. The TBA can also be used to calculate the part of imported products that are used as inputs into production processes and then exported again are referred to as re-exported intermediate products.
For the indicators based on the origins of value added by source country and industry, the TBA can be used to calculate the origin of the total value added in gross exports/imports/final demand broken down by the value-added generated by source industry and country.

Resource Details (Export Citation) GTAP Keywords
Category: 2022 Conference Paper
Status: Published
By/In: Presented during the 25th Annual Conference on Global Economic Analysis (Virtual Conference); (Submitted only waiting for review) in Economic Systems Research
Date: 2022
Version: 1
Created: Berthet, E. (4/15/2022)
Updated: Berthet, E. (6/8/2022)
Visits: 686
- Advances in quantitative methods
- Model extension/development
- Climate change policy
- Environmental policies
- Trade and the environment
- Other data bases and data issues
- Multilateral trade negotiations
- Preferential trading arrangements
- Supply chains

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Comments (1 posted)
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Posted by: Berthet, Etienne   4/15/2022 7:40:00 PM
The article has been submitted to a journal but has not yet been accepted.
Please keep it restricted so far.