Abstract

This paper proposes a structural decomposition analysis (SDA) augmented with cross-country atmospheric circulation and uncovers that changes in carbon monoxide (CO) levels are driven by atmospheric flows way more than by any of the traditional SDA components. Applied to a five-region model, our results show, among others, that South Korea has certainly been able to reduce the CO emissions in its own territory by 0.8Tg over 1990–2014 but up to 10.6Tg of CO flowing to its borders came from its upwind neighbor China. That amount was primarily driven by activities satisfying the growth of China's domestic demand, although changes in foreign demand and in the technology effect were not negligible. By quantifying the role of upwind countries in air pollution changes, our methodology allows us to identify more comprehensive global emission abatement policies than the consumer- or producer-focused approaches currently used.

Original languageEnglish (US)
JournalEconomic Systems Research
DOIs
StateAccepted/In press - 2024

Keywords

  • Carbon emissions
  • atmospheric flows
  • global supply chain
  • spillovers

ASJC Scopus subject areas

  • Economics and Econometrics

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