The value of output consists of the value of materials and services procured from
other sectors added to the value of primary inputs directly utilised in the production
process. The final demands for economic goods and services provide the driving
force for the whole system.
The input-output analysis comprises tables detailing, during a certain period, for
the different sectors constituting the economic system, the inputs to the production
processes together with the outputs obtained as a result. The input and output flows
are usually stated in monetary units.
Environmental concerns are incorporated in this framework by adding several
parts to the basic tables and detailing the various types of environmental pollution
triggered by the different economic sectors in the system. Even sectors which exist
solely for the abatement of pollution are given. The discharges of residuals and
requirements for inputs from the environment are dealt with in a similar way as for
primary inputs - capital and labour. Once again, the final demands for economic
goods and services provide the driving force for the whole system.
“What-if” scenarios can be simulated by changing end demand patterns or
structural relationships within the model. It is, thus, possible to generate various
alternative possibilities of economic development, discharge of residuals and ambient environmental quality. This can help policy makers select their best development
plan.
8.9.2 The Basic Procedure
The proceeding section described the materials balance view of economicenvironmental interaction. Formal approaches have used the input-output analysis
technique which proposes to relate each industry’s demands for each other industry’s
outputs, and also to relate outputs to final demands by consumers. In this way, the
effects of changes in individual industries on each of the other industries can be
assessed, as can changes in final demand on each industry. Since the technique is
quite general, it is possible to introduce, say, an industrial sector devoted to antipollution measures and to assess the effects of such measures on the industrial
structure. If prices are put into the model, the effects of such measures on the
structure of prices can also be estimated, and so on.
Equally, if we know the relationship between output and wastes, the effects of
changes in final demand on waste generation can also be estimated, and further
extensions might allow us to estimate the effects of various changes on resource
demand. These analyses can become very complex.
Table 8.3 displays input-output data for an economy comprising m industries
which produce n commodities. The table is a summary of the transactions occurring
within the economy during a specified period, usually a year. All the data are
converted to the appropriate monetary units for the economy concerned. For clarity
of explanation, it is assumed that the economy is closed to foreign trade.
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8 Analysis of Environmental Impacts of Infrastructure
other sectors added to the value of primary inputs directly utilised in the production
process. The final demands for economic goods and services provide the driving
force for the whole system.
The input-output analysis comprises tables detailing, during a certain period, for
the different sectors constituting the economic system, the inputs to the production
processes together with the outputs obtained as a result. The input and output flows
are usually stated in monetary units.
Environmental concerns are incorporated in this framework by adding several
parts to the basic tables and detailing the various types of environmental pollution
triggered by the different economic sectors in the system. Even sectors which exist
solely for the abatement of pollution are given. The discharges of residuals and
requirements for inputs from the environment are dealt with in a similar way as for
primary inputs - capital and labour. Once again, the final demands for economic
goods and services provide the driving force for the whole system.
“What-if” scenarios can be simulated by changing end demand patterns or
structural relationships within the model. It is, thus, possible to generate various
alternative possibilities of economic development, discharge of residuals and ambient environmental quality. This can help policy makers select their best development
plan.
8.9.2 The Basic Procedure
The proceeding section described the materials balance view of economicenvironmental interaction. Formal approaches have used the input-output analysis
technique which proposes to relate each industry’s demands for each other industry’s
outputs, and also to relate outputs to final demands by consumers. In this way, the
effects of changes in individual industries on each of the other industries can be
assessed, as can changes in final demand on each industry. Since the technique is
quite general, it is possible to introduce, say, an industrial sector devoted to antipollution measures and to assess the effects of such measures on the industrial
structure. If prices are put into the model, the effects of such measures on the
structure of prices can also be estimated, and so on.
Equally, if we know the relationship between output and wastes, the effects of
changes in final demand on waste generation can also be estimated, and further
extensions might allow us to estimate the effects of various changes on resource
demand. These analyses can become very complex.
Table 8.3 displays input-output data for an economy comprising m industries
which produce n commodities. The table is a summary of the transactions occurring
within the economy during a specified period, usually a year. All the data are
converted to the appropriate monetary units for the economy concerned. For clarity
of explanation, it is assumed that the economy is closed to foreign trade.
238
8 Analysis of Environmental Impacts of Infrastructure