Hostname: page-component-cd9895bd7-8ctnn Total loading time: 0 Render date: 2024-12-28T14:20:19.707Z Has data issue: false hasContentIssue false
  • English
  • Français

Affluence and emission tradeoffs: evidence from Indonesian households' carbon footprint

Published online by Cambridge University Press:  09 August 2017

Mohammad Iqbal Irfany  and
Stephan Klasen
Mohammad Iqbal Irfany
Affiliation:
Faculty of Economic Sciences, Georg-August-University of Goettingen, Oeconomicum, Platz der Göttinger Sieben 3, 37073 Göttingen, Germany; and International Centre for Applied Finance and Economics (InterCAFE), Bogor Agricultural University, Indonesia. E-mail: [email protected]
Stephan Klasen
Affiliation:
Faculty of Economic Sciences, Georg-August-University of Goettingen, Germany. E-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

This study estimates Indonesian households’ carbon emissions that are attributed to their expenditures in 2005 and 2009 to analyze the pattern, distribution and drivers of their carbon footprint. Employing an input-output-emission-expenditure framework, the authors find a significant difference in household carbon emissions between different affluence levels, regions and educational levels. They also find that, while many household characteristics influence emissions, total expenditure is by far the most important determinant of household emissions, both across households and over time. Consequently, emissions inequality is very similar to expenditure inequality across households. The decomposition analysis confirms that changes in emissions are predominantly due to rising expenditures between the two periods, while expenditure elasticities analysis suggests that the rise in household emissions is mainly caused by the overall rise in total household expenditure, and not by shifting consumption shares among consumption categories. The paper discusses policy options for Indonesia to reduce this very strong expenditure–emissions link.

Type
Research Article
Information
Environment and Development Economics , Volume 22 , Issue 5 , October 2017 , pp. 546 - 570
Copyright
Copyright © Cambridge University Press 2017 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Ang, B.W. (2005), ‘The LMDI approach to decomposition analysis: a practical guide’, Energy Policy 32: 1131–1139.Google Scholar
Bin, S. and Dowlatabadi, H. (2005), ‘Consumer lifestyle approach to US energy use and the related CO2 emissions’, Energy Policy 33(2): 197–208.Google Scholar
Cameron, A.C. and Trivedi, P.K. (2010), Microeconometrics Using Stata (revised edn) College Station, TX: Stata Press.Google Scholar
Chow, G.C. and Li, J. (2014), ‘Environmental Kuznets curve: conclusive econometric evidence for’, Pacific Economic Review 19(1): 1–7.Google Scholar
Deaton, A. and Kozel, V. (2005), ‘Data and dogma: the great Indian poverty debate’, World Bank Research Observer 20(2): 177–199.CrossRefGoogle Scholar
Deaton, A. and Muellbauer, J. (1980), Economics and Consumer Behavior, Cambridge: Cambridge University Press.Google Scholar
EDGAR (2016), Emission Database for Global Atmospheric Research (EDGAR), Release Version 4.3.2, [Available at] http://edgar.jrc.ec.europa.eu/ Google Scholar
Girod, B. and de Haan, P. (2009), ‘GHG reduction potential of changes in consumption patterns and higher quality levels: evidence from Swiss household consumption survey’, Energy Policy 37(12): 5650–5661.Google Scholar
GOI (Government of Indonesia) (2015), Intended Nationally Determined Contribution, Republic of Indonesia, Geneva: UNFCCC.Google Scholar
GOI (Government of Indonesia) (2016), First Nationally Determined Contribution, Government of Indonesia, Geneva: UNFCCC.Google Scholar
Grossman, G.M. and Krueger, A.B. (1995), ‘Economic growth and the environment’, Quarterly Journal of Economics 110(2): 353–377.Google Scholar
Grunewald, N. (2013), ‘ Growth, carbon dioxide emissions, climate and wellbeing ’, PhD thesis, Wirtschaftswissenschaftlichen Fakultät, University of Göttingen.Google Scholar
Huff, K., McDougall, R., and Walmsley, T. (2000), ‘Contributing input-output tables to the GTAP data base’, GTAP Technical Paper 1(4.2), Global Trade Analysis Project, West Lafayette, IN.Google Scholar
IEA (International Energy Agency) (2013), CO 2 Emissions from Fuel Combustion, [Available at] http://www.iea.org/publications/freepublications/publication/co2emissionsfromfuelcombustionhighlights2013.pdf.Google Scholar
IPCC (Intergovernmental Panel on Climate Change) (2014), Climate Change 2014: Mitigation of Climate Change, Contribution of Working Group III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change [Edenhofer, O., Pichs-Madruga, R., Sokona, Y., et al. (eds)], Cambridge and New York, NY: Cambridge University Press.Google Scholar
Irfany, M.I. and Klasen, S. (2016), ‘Inequality in emissions: evidence from Indonesian household carbon footprint’, Environmental Economics and Policy Studies 8(4): 459–483.Google Scholar
Jakob, M., Steckel, J.C., Klasen, S., et al. (2014), ‘Feasible mitigation actions in developing countries’, Nature Climate Change 4(11): 961–968.CrossRefGoogle Scholar
Kaya, Y. (1990), ‘Impact of carbon dioxide emission control on GNP growth: interpretation of proposed scenarios’, Energy and Industry Subgroup Memorandum, IPCC Response Strategies Working Group, Geneva.Google Scholar
Kenny, T. and Gray, N.F. (2009), ‘A preliminary survey of household and personal carbon dioxide emissions in Ireland’, Environment InterTotal Expenditure 35: 259–272.Google Scholar
Kok, R., Benders, R.M.J., and Moll, H.C. (2006), ‘Measuring the environmental load of household consumption using some methods based on input–output energy analysis: a comparison of methods and a discussion of results’, Energy Policy 34(17): 2744–2761.Google Scholar
Lenzen, M. (1998a), ‘Energy and greenhouse gas cost of living for Australia during 1993/94’, Energy 23(6): 497–516.Google Scholar
Lenzen, M. (1998b), ‘Primary energy and greenhouse gases embodied in Australian final consumption: an input-output analysis’, Energy Policy 26(6): 495–506.Google Scholar
Lenzen, M., Wier, M., Cohen, C., Hayami, H., Pachauri, S., and Schaeffer, R. (2006), ‘A comparative multivariate analysis of household energy requirements in Australia, Brazil, Denmark, India and Japan’, Energy 31(2–3): 181–207.Google Scholar
Li, J. and Wang, Y. (2010), ‘Income, lifestyle and household carbon footprints (carbon–income relationship), a micro-level analysis on China's urban and rural household surveys’, Environmental Economics 1(2).Google Scholar
Mishra, S.C. (2009), ‘Economic inequality in Indonesia: trend causes and policy responses’, UNDP Regional Office Paper, Strategic Asia.Google Scholar
Murthy, N., Panda, M., and Parikh, J. (1997), ‘Economic development, poverty reduction and carbon emissions in India’, Energy Economics 19(3): 327–354.Google Scholar
Pachauri, S. and Spreng, D. (2002), ‘Direct and indirect energy requirements of households in India’, Energy Policy 30(6): 511–523.Google Scholar
Parikh, J., Panda, M., and Murthy, N.S. (1997), ‘Consumption patterns by income groups and carbon dioxide implications for India: 1990–2010’, International Journal of Global Energy 9(4–6): 237–255.Google Scholar
PEACE (2007), Indonesia and Climate Change: Current Status and Policies, [Available at] http://siteresources.worldbank.org/INTINDONESIA/Resources/Environment/ClimateChange_Full_EN.pdf.Google Scholar
Renner, S., Lay, J., Schleicher, M., and Nuryartono, N. (2015), ‘Poverty and distributional impact of energy subsidy reform in Indonesia’, Mimeo, GIGA Institute, Hamburg.Google Scholar
Serino, M.N. and Klasen, S. (2015), ‘Estimation and determinants of the Philippines’ household carbon footprint’, Developing Economies 53(1): 44–62.Google Scholar
Siagian, U.W.R., Dewi, R.G., Boer, R., Hendrawana, I., Yuwono, B.B., and Ginting, G.E. (2015), Pathways to Deep Decarbonization in Indonesia, Paris: Sustainable Development Solutions Network (SDSN) and Institute for Sustainable Development and International Relations (IDDRI).Google Scholar
Stern, D., Common, M.S., and Barbier, E. (1996), ‘Economic growth and environmental degradation: the environmental Kuznets curve and sustainable development’, World Development 24(7): 1151–1160.Google Scholar
Torras, M. and Boyce, J.K. (1998), ‘Income, inequality, and pollution: a reassessment of the environmental Kuznets curve’, Ecological Economics 25: 147–160.Google Scholar
UNFCCC (2010), ‘United Nations Framework Convention on Climate Change’, [Available at] http://unfccc.int/2860.php.Google Scholar
Wagner, M. (2008), ‘The carbon Kuznets curve: a cloudy picture emitted by bad econometrics?’, Resource and Energy Economics 30(3): 388–408.Google Scholar
Wier, M., Lenzen, M., Munksgaard, J., and Smed, S. (2001), ‘Effects of household consumption patterns on CO2 requirements’, Economic Systems Research 13: 259–274.Google Scholar
York, R. (2012), ‘Asymmetric effects of economic growth and decline on CO2 emissions’, Nature Climate Change 2: 762–764.CrossRefGoogle Scholar
Yusuf, A.A. (2006), ‘On the re-assessment of inequality in Indonesia: household survey or national account?’, MPRA Paper No. 1728, [Available at] https://mpra.ub.uni-muenchen.de/1728/.Google Scholar
Supplementary material: PDF

Irfany and Klasen supplementary material

Online Appendix

Download Irfany and Klasen supplementary material(PDF)
PDF 1.3 MB