Structural decomposition analysis of Australiaʹs greenhouse gas emissions

A complex system of production links our greenhouse gas emissions to our consumer demands. Whilst progress may be made in improving efficiency, other changes in the production structure may easily annul global improvements. Utilising a structural decomposition analysis, a comparative-static technique of input–output analysis, over a time period of around 30 years, net greenhouse emissions are decomposed in this study into the effects, due to changes in industrial efficiency, forward linkages, inter-industry structure, backward linkages, type of final demand, cause of final demand, population affluence, population size, and mix and level of exports. Historically, significant competing forces at both the whole of economy and industrial scale have been mitigating potential improvements. Key sectors and structural influences are identified that have historically shown the greatest potential for change, and would likely have the greatest net impact. Results clearly reinforce that the current dichotomy of growth and exports are the key problems in need of address.