Tema 5. The anthropic footprint as a measure of sustainability The concept of ecological footprint Input-output Models Data Sources

1. The concept of ecological footprint

Ecological footprint It represents the amount of biologically productive land and sea area necessary to supply the resources a human population consumes, and to assimilate associated waste (Wackernagel y Rees, 1996) Environmental footprints= CONSUMPTION + (IMPORTS-EXPORTS) Ecological footprint? = Hectares Carbon footprint? = CO2 Water footprint? = Water Resources and land necessaries to satisfy human demands http://www.footprintnetwork.org/en/index.php/GFN/

http://www. footprintnetwork http://www.footprintnetwork.org/documents/2016_Living_Planet_Report_Lo.pdf

Biocapacity.- The capacity of ecosystems to produce useful biological materials (those demanded by humans) and to absorb waste materials generated by humans, using current management schemes and extraction technologies

A summary of footprints Carbon footprint (Minx et al, 2009)* “The total sets of greenhouse gas emissions caused by an organization, event, product or individual” Water footprint (Hoekstra et al., 2011)*  “The water footprint tells us how much water is used each and every day in all our activities, such as for producing our food and to clothe us, and indicates the pressure we exert on our freshwater resources.” Material footprint (Wiedmann et al., 2013)*  “Full material requirements of all countries covering a period of two decades. Called the “material footprint,” this indicator provides a consumption perspective of resource use and new insights into the actual resource productivity of nations” Labour footprint (Alsamawi et al., 2014)*  “A country’s domestic employment and that recruited along the supply chains of, and hence embodied in, its imported goods and services” * Minx, J. C., Wiedmann, T., Wood, R., Peters, G. P., Lenzen, M., Owen, A., et al. (2009). Input-Output analysis and carbon footprinting: an overview of applications. Economic Systems Research, 21(3), 187-216. * Hoekstra, A. Y., Chapagain, A. K., Aldaya, M. M., & Mekonnen, M. M. (2011). The water footprint assessment manual : setting the global standard. London ; Washington, DC: Earthscan * Wiedmann, T. O., Schandl, H., Lenzen, M., Moran, D., Suh, S., West, J., et al. (2013). The material footprint of nations. Proceedings of the National Academy of Sciences. * Alsamawi, A., Murray, J., & Lenzen, M. (2014). The Employment Footprints of Nations. Journal of Industrial Ecology, 18(1), 59-70.*

Hoekstra, A. Y. , & Wiedmann, T. O. (2014) Hoekstra, A. Y., & Wiedmann, T. O. (2014). Humanity’s unsustainable environmental footprint. Science, 344(6188), 1114-1117. Definiciones The blue water footprint refers to consumption of blue water resources (surface and groundwater) along the supply chain of a product. ‘Consumption’ refers to loss of water from the available ground-surface water body in a catchment area. Losses occur when water evaporates, returns to another catchment area or the sea or is incorporated into a product. The green water footprint refers to consumption of green water resources (rainwater insofar as it does not become run-off). The grey water footprint refers to pollution and is defined as the volume of freshwater that is required to assimilate the load of pollutants given natural background concentrations and existing ambient water quality standards. Hoeskstra and Wiedmann (2014)*

Fig. 1. MF of national final demand of selected countries in 2008 (totals and per capita)* Wiedmann, T. O., H. Schandl, M. Lenzen, D. Moran, S. Suh, J. West and K. Kanemoto. (2013): The material footprint of nations Proceedings of the National Academy of Sciences. Wiedmann et al. (2013)*

Mekonnen, M. M., & Hoekstra, A. Y. (2014).* * Mekonnen, M. M., & Hoekstra, A. Y. (2014). National water footprint accounts: the green, blue and grey water footprint of production and consumption. Delft, the Netherlands. Mekonnen, M. M., & Hoekstra, A. Y. (2014).*

Carbon footprint Measure for Goods and services.- The total amount of GHG trough the life cycle.

Producer responsibility Consumer responsibility Who is responsible? Producer responsibility Share responsibility Consumer responsibility Who has it produced? To who benefits? Who has it consumed ?

Producer responsability GHG emissions are allocated to the country in which the emission occurred. Disadvantages: Exclude international transport and a country … account for its exports (production, but not consumption) … does not account for its imports As a consequence… Increase of GHG related to international commerce (globalization and offshoring) Unfair treatment of developing countries. Opposition of exports and pollutent economies (China) Consumers are excluded from signaling “clean production” Carbon leakage.

Carbon leakage Kyoto Protocol (2008-2012) and its Doha Amendment (2012) does not apply in all countries  Incentives to relocate production to countries outside KP or with weak environmental legislations, as a consequence the countries fulfill its commitments by importing “more polluted” products. It could increase the global pollution, because the industries relocate in countries with technologies more polluting. Pollution haven hypothesis, PHH)  The offshoring of polluting industries to more permissive countries concerning environmental regulations. Strong.- Industries relocate from KP-countries to a non-KP country. Weak.- Increasing demand of a KP-country is covered via imports of non-KP countries.

Pollution Haven Hypothesis China has become a pollution haven for the Spanish economy. The balance of avoided emissions between these two countries shows an increase of emissions of 29,667 KtCO2 in 2005 because of the existence of international trade between the countries. López, L.-A., Arce, G., y Zafrilla, J. (2014). China, refugio de las emisiones de España. Investigación y Ciencia, 451, 10-12. López, L.A., Arce, G., y Zafrilla, J. (2014).

Consumer responsability Consumption-based GHG inventories account for emissions from production and imports, and subtracts embodied emissions exported in trade. Some advantages.- Avoids carbon leakage and concerns about competitivity Encourage international cooperation among developed and developing countries to transfer cleaner technologies. Consumer and regulators will became more aware of their decisions

Share responsability Allocation schemes in which carbon emissions are shared between producers and consumers These shared allocation schemes provide economic incentive to the consumer nation to favour products with the smallest environmental impacts, and thereby push producers to reduce the carbon emissions embodied in their products

2. Input-Output Models

The “founding” father Leontief, W. (1936): “Quantitative relationships in the economic system of the United States”, Review of Economics and Statistics, 18, 105-125. Leontief, W. (1941): The structure of the American economy: 1919-1939, Oxford University Press, New York (ampliada, 1951). 1906-1999 Premio Nobel en 1973: "for the development of the input-output method and for its application to important economic problems".

http://www.aenor.es/aenor/normas/ediciones/fichae.asp?codigo=12292#.WezY8mh-ouU

Single Regional Input-Output Table (SRIO)

Intermediate consumes The concept of ecological footprint Input-output Models Life Cycle Assesment Models Measuring ecological footprints… Intermediate consumes Sectors 1 2 ... n Z11 Z12 Z1n Z21 Z22 Z2n Zij Zn1 Zn2 Znn Sales of row-sector to the rest Purchases of column-sector to the rest Domestic intermediate consumption Inputs (requirements) of the production process of column-sector

Intermediate consumption matrix

Intermediate consumption matrix ¿De qué informa por filas? ¿Y por columnas? ¿La estructura de costes de inputs de una rama se ve por filas o por columnas? Cuánto vende la rama de “Coquerías, refino y combustibles nucleares” a la “Pesca y acuicultura” ¿Te suena raro? Cuánta energía eléctrica usa la rama agrícola Esas cantidades son domésticas, totales o importadas

Final Demand ¡Warning! Investment does NOT FROM to the sector, but to the whole economy ON this sector

Final Demand Matrix

¿De qué informa por filas? ¿Y por columnas? Final Demand Matrix ¿De qué informa por filas? ¿Y por columnas? Cuál es la inversión de la Agricultura [de productos de la agricultura realizada por toda la economía] Cuántos productos químicos exporta la economía Esas cantidades son domésticas, totales o importadas

RA W1 W2 ... Wn EBE B1 B2 Bn VAB VAB1 VAB2 VABn PE=CI+VAB X1 X2 Xn M Primary inputs RA W1 W2 ... Wn EBE B1 B2 Bn VAB VAB1 VAB2 VABn PE=CI+VAB X1 X2 Xn M M1 M2 Mn Total Recursos =PE+M R1 R2 Rn RA.-

Primary Inputs Matrix

¿De qué informa por filas? ¿Y por columnas? Primary Inputs Matrix ¿De qué informa por filas? ¿Y por columnas? ¿De qué es la suma el valor añadido? Cuál es el volumen de salarios de la agricultura Cuál es el excedente bruto de explotación (Bº) de la rama de distribución energía electríca ¿Esas cantidades son domésticas, totales o importadas?

Imported intermediate output (r=regions) Domestic intermediate output Basic identities By rows By columns (Structure costs of the sector) Value added Output of sector j Imported intermediate output (r=regions) Domestic intermediate output

The technical coefficients The technical coefficient, input-output coefficient or direct input coefficient (aij) are the ratio of quantity of input of sector i (row) which is necessary to produce one unit of output of sector j (column). The ratios are assumed to be constant (main assumption and critic) By rows.- intermediate inputs of i sectors which are used by j sectors By columns.- intermediate inputs used by the sector j as requeriments to accomplished its production.

Input-output coefficient table Input-output flow table and accounts* Input-output coefficient table / Inputs per unit of output * Martínez Alier, J., & Roca, J. (2013). Economía ecológica y política ambiental (3ºed ed.). México, D.F.: Fondo de Cultura Económica, pags. 46ss 𝑎 𝑖𝑗 = 𝑍 𝑖𝑗 𝑥 𝑗 = 500 5000 … … … ⋱ … … … ⋱ = 0,1 … … … ⋱ … … … ⋱

Input-output coefficient table 0.1 𝑋 𝐴 +0.2 𝑋 𝐵 +0.1 𝑋 𝐶 +3040=5000 0.2 𝑋 𝐴 +0.3 𝑋 𝐵 +0.2 𝑋 𝐶 +1690=5100 0.1 𝑋 𝐴 +0.2 𝑋 𝐵 +0.3 𝑋 𝐶 +1560=4400 0,1 0,2 0,1 0,2 0,3 0,2 0,1 0,2 0,3 · 5000 5100 4400 + 3040 1690 1560 = 5000 5100 4400

From identities to models Input-Output matrix are accounting identities and… … became an economic tool when Leontief introduced an assumption of fixed-coefficient linear production functions relating inputs used by an industry along each column to its output flow, i.e., for one unit of every industry's output, a fixed amount of input of each kind is required. Back assumptions of the model: Productions functions are lineal Fixed technical coefficients There is constant scale returns Prices does not influx

𝐴𝑋+𝑌=𝑋 𝑋−𝐴𝑋=𝑌 𝐼−𝐴 𝑋=𝑌 𝑋= (𝐼−𝐴) −1 ·𝑌 Solving the model 𝑎 11 𝑎 12 𝑎 13 𝑎 21 𝑎 22 𝑎 23 . . . 𝑎 𝑛1 𝑎 𝑛2 𝑛 · 𝑋 1 𝑋 2 . 𝑋 𝑛 + 𝑌 1 𝑌 2 . 𝑌 𝑛 = 𝑋 1 𝑋 2 . 𝑋 𝑛 𝐴𝑋+𝑌=𝑋 𝑋−𝐴𝑋=𝑌 𝐼−𝐴 𝑋=𝑌 𝑋= (𝐼−𝐴) −1 ·𝑌

∆𝒙= (𝑰−𝑨) −𝟏 ·∆𝒚 Multiplier Leontieff inverse Considering fixed-linear coefficients, it is possible to calculate what output levels would be required to meet various postulated levels of net final demand and consequently… … how output levels would be required to change to meet postulated changes in net final demand ∆𝒙= (𝑰−𝑨) −𝟏 ·∆𝒚 Multiplier

Leontieff inverse (𝐼−𝐴) −1 = 1.243 0.442 0.304 0.442 1.713 0.552 0.304 0.552 1.630 To satisfy an additional unit of final demand of sector 1, it is required to produced 0,304 units of sector 3.

Unitary increase in Final Demand A chain reaction… The leontieff inverse as a sucession of rounds, (tier o layers) Direct Effects Indirect Effects Unitary increase in Final Demand Inputs necesarios en una etapa anterior de la producción para producir los inputs directos Inputs que directamente se necesitan para producir esa unidad de producto final

What happened if a textil company wants to increase its pull-over production? … I A2 A

Sector Verticalmente Integrado 1 Example En forma matricial, esto mismo es (con aumento de la demanda final en un solo sector igual a la unidad, por ejemplo, en el sector 1): Sector Verticalmente Integrado 1 Producción necesaria, directa e indirectamente, en el sector 1 para atender 1 unidad de DF de bien 1 Producción necesaria, directa e indirectamente, en el sector 2 para atender 1 unidad de DF de bien 1

The economic meaning ot the Leontieff Inverse βij recoge la producción necesaria, directa e indirectamente, en la rama i (primer subíndice) para producir una unidad de producto de la rama j (segundo subíndice) que pueda ir destinado a la demanda final. Demanda final diagonalizada Sector Verticalmente Integrado (SVI) (Columnas) Sector Observable (Filas)

Multipliers and factor contents When the leontieff inverse is pre-multiplied by a factor we get a multiplier which shows the requeriments of that factor to get one unit of final output. Output 𝒙= (𝑰−𝑨) −𝟏 ·𝒚 Any Factor F= 𝒇 (𝑰−𝑨) −𝟏 · 𝒚=𝑭𝑴·𝒚

Emissions Emissions coefficients (Emissions per unit of output) Extended IO Table (With Emissions) Emissions Multiplier

Multio Regional Input-Output Table (MRIO)

Multio Regional Input-Output Table (MRIO)

Multio Regional Input-Output Table (MRIO)

Multipliers and factor contents Any Factor F= 𝒇 (𝑰−𝑨) −𝟏 · 𝒚=𝑭𝑴·𝒚

Emissions Emissions multiplier E= 𝒆 (𝑰−𝑨) −𝟏 𝒚 =𝐸𝑀· 𝒚 Once we have the output in M€uros we can easily extend the model for the other impacts which are intended to assess in the present paper. For instance, concerning the value added, in a in a MRIO context we have that the total value added generated by the EFARD (v) are: 𝒗=𝒗𝒂 (𝑰−𝑨) −𝟏 𝒚 (6) Where v is the [1x(nxr)] vector of value added per unit of output of each sector n in each region r (value added coefficients). The product va(I – A)-1 provides the value-added multiplier. We will work with diagonal matrices of final demand and value added coefficients ( y 𝑎𝑛𝑑 𝑣𝑎 , respectively), so we will obtain a matrix of value-added multipliers (P) and a matrix of total value added (V): 𝑽= 𝒗𝒂 (𝑰−𝑨) −𝟏 𝒚 =𝑷 𝒚 (7) The matrix Prs in value-added multiplier P shows total value-added that occur in country r when attending a unit of final demand of country s. Summing V matrix by rows results in total value-adeed (domestic) per production country ( 𝑉 𝑟 = 𝑆 𝑉 𝑟𝑠 ). Summing up along columns we have ‘vertical integration by countries’ or value-added generated all over the world linked to one country’s final demand ( 𝑣 𝑠 = 𝑟 𝑉 𝑟𝑠 ). By rows: emisions related to the good production (first subscript) By columns: emissions rearranged by SVI. Emissions related to the the process of production of a merchandise for Final Demand (second subscript)

Facebook: Economic Impact Labour Impact Example Un estudio mide el impacto laboral y económico de la red social en la Unión Europea. Según la empresa, aporta 15.300 millones de euros al PIB comunitario y ha ayudado a crear más de 230.000 trabajos. Economic Impact Labour Impact

Computing responsabilities Producer responsibility Share responsibility Consumer responsibility Who has it produced? To who benefits? Who has it consumed ?

Consumer and Producer responsability (MRIO) By rows: Producer responsability By columns: Consumer responsability Note.- Ft  Factor under analysis (Emissions, energy, materials…)

3. Data Sources

Glossary Input-Output Framework Simmetric, Supply and Use matrix Input-Output Transaction Table Intermediate consumes Final demand Primary inputs Identities vs models Technical Coefficients Leontieff inverse Rounds, tiers or layers Factor contents Multi-Regional Single-Regional Ecological footprint Carbon footprint Water footprint: Green, Blue, Gray Material footprint Biocapacity Kyoto protocol Producer responsibility Consumer responsibility Share responsibility Carbon Leakage Pollution Haven Hypothesis