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How production-based and consumption-based emissions accounting systems change climate policy analysis: the case of CO2 convergence

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Abstract

Much of the existing research analyses on emissions and climate policy are dominantly based on emissions data provided by production-based accounting (PBA) system. However, PBA provides an incomplete picture of driving forces behind these emission changes and impact of global trade on emissions, simply by neglecting the environmental impacts of consumption. To remedy this problem, several studies propose to consider national emissions calculated by consumption-based accounting (CBA) systems in greenhouse gas (GHG) assessments for progress and comparisons among the countries. In this article, we question the relevance of PBA’s dominance. To this end, we, firstly, try to assess and compare PBA with CBA adopted in greenhouse gas emissions accounting systems in climate change debates on several issues and to discuss the policy implications of the choice of approach. Secondly, we investigate the convergence patterns in production-based and consumption-based emissions in 35 Annex B countries for the period between 1990 and 2015. This study, for the first time, puts all these arguments together and discusses possible outcomes of convergence analysis by employing both the production- and consumption-based CO2 per capita emissions data. The empirical results found some important conclusions which challenge most of the existing CO2 convergence studies.

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Notes

  1. Emissions embodied in trade are significant part of the global emissions as recent studies estimated that up to 25–30% of global emissions are generated from such operations (Zhang et al. 2017; Wang et al. 2015; Davis and Caldiera, 2010; Peters and Hertwich 2008).

  2. The gap between embodied emissions in imports and exports might be due to the increasing gap between the trade volume of import and export as well as changing the trade patterns.

  3. For the Stocktaking process and long-term objectives of the Paris Agreement, see http://www.wri.org/blog/2017/05/insider-designing-global-stocktake-under-paris-agreement-catalyst-climate-action

  4. These various concepts can in turn be divided into absolute and conditional convergence. In contrast with absolute convergence, conditional convergence assumes the possible differences among countries.

  5. For a detailed literature review of convergence studies on environment, please refer to Pettersson et al. 2014; Bilgili and Ulucak 2018; Acar et al. 2018.

  6. A number of recent studies acknowledges ecological footprint in convergence analysis. Yet, these studies do not solely rely on CO2 emissions per capita, instead use ecological footprint as an indicator, which includes six environment-related components (Ulucak and Apergis 2018; Bilgili and Ulucak 2018; Solarin 2019; Özcan et al., 2019). Our study differs from these studies both in terms of scope, database, and methodology as their analysis cover much broader context while we directly focus on CO2 emissions calculated by PBA and CBA.

  7. The Global Carbon Atlas Database (2018) can be viewed from http://www.globalcarbonatlas.org/en/CO2-emissions

  8. (xmper) data is calculated by dividing exports plus imports of goods and services by total population.

  9. Due to the issues on completeness of data on CBA, we excluded Iceland, Liechtenstein, Luxemburg, Malta, and Monaco from the original Annex B list.

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Authors and Affiliations

  1. Aydın, Turkey

    Etem Karakaya

  2. Department of Economics, Faculty of Economic and Administrative Sciences, Adnan Menderes University, Nazilli, Aydın, Turkey

    Burcu Yılmaz & Sedat Alataş

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  1. Etem Karakaya
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Correspondence to Sedat Alataş.

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Karakaya, E., Yılmaz, B. & Alataş, S. How production-based and consumption-based emissions accounting systems change climate policy analysis: the case of CO2 convergence. Environ Sci Pollut Res 26, 16682–16694 (2019). https://doi.org/10.1007/s11356-019-05007-2

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