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A recent greenview article in The Economist looked at “Consumption-based accounting of CO2 emissions”, a paper in PNAS by Ken Caldeira and Steven Davis. Caldeira and Davis look at how much carbon dioxide each country would be deemed responsible for if you looked at the carbon emitted in the production of everything a country consumed minus the carbon emitted in the production of that which it exports. In such a world the emissions from developed countries go up, because they import a lot of manufactured goods, and the emissions from large emerging economies, in particular China, go down, because a lot of the carbon dioxide they emit is associated with goods they export.One way to look at this is to see flows of exports as flows of carbon, as in their illustration.
This is a rather reasonable and depressing view of the world:
The authors write, and many will agree, that this form of accounting “provides grounding for ethical arguments that the most developed countries—as the primary beneficiaries of emissions and with greater ability to pay—should lead the global mitigation effort.” But, though the ability to pay is not much in doubt, the idea that the benefits from this process all accrue to the developed world is a little simplistic. This is, after all, trade: benefits flow the other way, too, in the form of a great deal of money. The big emerging economies were not duped into taking on the developed world’s carbon emissions. They knew what they were doing and have profited from it.
That said, looking at carbon emissions this way does make the world seem a grimmer place, for three reasons. The first is that the Carnegie analysis, and similar work elsewhere, show that much of what has seemed like progress on the climate is anything but. As Dieter Helm of Oxford University and his colleagues pointed out a few years ago, Britain may be proud of cutting its greenhouse gas emissions by some 15% from 1990 to 2005, but the consumption that produced many of those emissions is still going on, and so are the emissions—they are just going on elsewhere. Indeed, according to the Carnegie analysis, Britain’s balance of trade in carbon dioxide (its imports less its exports) in 2004 was greater than that of any other big European country: 253m tonnes, almost half as much as the emissions from the country’s own territory.
The second reason for gloom is that the trade involved is not a zero-sum game. Moving emissions away from de-industrialising developed countries does not just shift them unchanged from one column to another in some great climatic spreadsheet. It makes the emissions bigger, because the energy infrastructure of developing countries is more carbon intensive. According to the Carnegie analysis the amount of carbon dioxide produced per unit of industrial energy used to make exports is 50% greater in China than in America. This is one of the reasons why assumptions made in the 1990s about the likelihood of the world economy becoming ever less carbon intensive have not come to pass. Trade is moving production from less carbon-intensive economies to more carbon-intensive ones.
The third reason for gloom is that seeing things this way makes dealing with the emissions problem even harder. The only international agreement on the matter, the Kyoto Protocol, limits emissions only from the developed countries that are party to it. Although there is little evidence that such limits have in and of themselves driven carbon-intensive industries out of the countries concerned—a phenomenon known as carbon leakage—they do make the natural movement of industry to the developing world, where emissions are unconstrained, harder to deal with.
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