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Structural Decomposition Analysis of Physical Flows in the Economy
Authors:Rutger Hoekstra  Jeroen C.J.M. van den Bergh
Affiliation:(1) Department of Spatial Economics, Free University, De Boelelaan 1105, 1081 HV Amsterdam, The Netherlands
Abstract:Many environmental problems can be attributedto the extraction and emissions of physicalsubstances. Increasing our understanding of theeconomic and technological driving forcesbehind these physical flows can contribute tosolving the environmental problems related tothem. The input-output framework is a usefulsetting in which to integrate detailedinformation about economic structure andphysical flows. In this article a specificmethod in input-output analysis is reviewed,namely Structural Decomposition Analysis (SDA).It is based on comparative static analysis,which decomposes historical changes of a policyvariable into determinant effects. SDA has beenapplied, for example, to analyze the demand andtechnological driving forces of energy use,CO2-emissions and various other pollutantsand resources. This article examines thetheoretical aspects of structuraldecomposition, in particular those concerningphysical flows and environmental issues.Furthermore, the article includes an extensivesurvey of empirical studies.
Keywords:CO2-emissions  comparative static analysis  energy use  environmental analysis  input-output analysis  material flows  physical flows  structural change  technological change
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