ABSTRACT
N PHYSICALmOWACCOUNTSWHICHAREQUANTIlEDINPHYSICALRATHERTHANMONETARY UNITS
N ACCOUNTSTHATLINKPHYSICALANDMONETARYDATAREFERREDTOINTHE3%%!ASHYBRID ACCOUNTS
N DISAGGREGATIONOFDATAFROMTHECONVENTIONALACCOUNTSONENVIRONMENTALPRO TECTIONEXPENDITURES
N NATURALRESOURCEASSETACCOUNTSINBOTHPHYSICALANDMONETARYTERMSAND N ENVIRONMENTALLYADJUSTEDMACROECONOMICINDICATORS
4HISCHAPTERPROVIDESANOVERVIEWOFEACHOFTHESECOMPONENTSDESCRIBING THEMFROMTHEPERSPECTIVEOFHOWTHEYBUILDONTHE3.!4HERESTOFTHEBOOKTHEN CONSIDERSTHEMINMOREDETAILTAKINGASTHEPOINTOFDEPARTURETHEENVIRONMEN TALISSUESTHEYADDRESSRATHERTHANTHESTRUCTUREOFTHE3.!4HETWOAPPROACHES COMPLEMENTRATHERTHANDUPLICATEEACHOTHER4HElRSTISNECESSARYTOUNDERSTAND WHATTHEACCOUNTSTHEMSELVESAREALLABOUTANDWHATPURPOSESTHEYCANANDCAN NOTSERVE4HESECONDOFFERSGREATERRICHNESSFROMANENVIRONMENTALPERSPECTIVE BUTWOULDNOTMAKESENSEONITSOWN
4HEPHYSICAL FLOWACCOUNTSDISTINGUISHFOURKINDSOF FLOWSˆPRODUCTSNATURAL RESOURCESECOSYSTEMINPUTSANDRESIDUALSˆANDTWOSPHERESINWHICHTHEYCAN OCCURECONOMICANDENVIRONMENTAL
ECONOMICSPHEREWHERETHEYAREPRODUCEDANDCONSUMED
N .ATURAL RESOURCESWHICH INCLUDEMINERALSENERGY SOILWATERANDBIOLOGI CALMATERIALARECREATEDINTHEENVIRONMENTALSPHERE4HEIRCREATIONDOESNOT INVOLVEECONOMICACTIVITYBUTTHEYAREINPUTINTOTHEECONOMICSPHEREINTHE PRODUCTIONPROCESS4HEMOVEMENTOFRESOURCESFROMTHEENVIRONMENTALTOTHE ECONOMICSPHEREISAKEYISSUEINPHYSICALmOWACCOUNTS
N %COSYSTEMINPUTSARELESSTANGIBLECOMPONENTSOFTHEENVIRONMENTALSPHERE THANNATURALRESOURCES4HEYINCLUDESUCHITEMSASGASESINTHEATMOSPHERETHAT AREESSENTIALFORCOMBUSTIONANDCLEANAIRANDWATERTOSUPPORTLIFE7ATERFALLS INTOTHREEOFTHESECATEGORIESBEINGANATURALRESOURCEUSEDINTHEECONOMY ANECOSYSTEMINPUTONWHICHLIFEDEPENDSANDAPRODUCTWHENSOLDBOTTLED )TPOSESPARTICULARLYDIFlCULTPROBLEMSFORACCOUNTING %COSYSTEMINPUTSARE INPUTSINTOPRODUCTIONANDMAYBEDEGRADEDBYPRODUCTIONORBYDISPOSALOFTHE WASTESFROMlNALCONSUMPTION
N 2ESIDUALSAREWASTESFROMPRODUCTIONORCONSUMPTION!LTHOUGHTHEDIFFERENCE BETWEENRESIDUALSANDPRODUCTSISSOMETIMESOBVIOUSˆNOONEWOULDMISTAKE STEELFORTHESMOKECOMINGOUTOFTHESTEELMILLSCHIMNEYSˆTHISISNOTALWAYS THECASE7HENUNWANTEDMATERIALSUCHASCHICKENFACTORY FARMWASTEISSOLD ASFERTILIZERITISCONSIDEREDTOBEASECONDARYPRODUCTTHATSTAYSINTHEECONOMIC SPHERE7HENITISGIVENAWAYFORTHESAMEUSEITISCONSIDEREDTOBEARESIDUAL BUTITREMAINSINTHEECONOMICSPHERE7HENITISDISCARDEDITISCONSIDEREDTO BEARESIDUALTHATmOWSFROMTHEECONOMICTOTHEENVIRONMENTALSPHERE
)NADDITIONTODISTINGUISHINGBETWEENECONOMICANDENVIRONMENTALSPHERESTHE 3%%!MUSTDISTINGUISHmOWSWITHINTHENATIONALARENABOTHECONOMYANDENVI RONMENT FROMmOWSBETWEENTHENATIONALARENAANDTHERESTOFTHEWORLD4ABLE PROVIDESASIMPLECLASSIlCATIONOFTHESEmOWS 4HECONCEPTOFRESIDENCEDISCUSSEDIN#HAPTERISIMPORTANTINUNDERSTANDING
THECLASSIlCATIONOFSOMEOFTHESEmOWS.ATURALRESOURCEmOWSAREAPRIMEEXAM PLE4HEYARECONSIDEREDTOENTERTHEECONOMYINTHECOUNTRYWHERETHEYORIGINATE EVENIFTHEYAREIMMEDIATELYEXPORTED4HUSPETROLEUMPUMPEDIN3AUDI!RABIABY AN!MERICANOILCOMPANYANDSHIPPEDDIRECTLYTOTHE5NITED3TATESFORPROCESS INGWOULDENTERTHE3AUDIECONOMYANDBEACCOUNTEDFORASA3AUDIEXPORTTOTHE 5NITED3TATES4HEmOWFROMTHE3AUDIECONOMYTOTHE53ECONOMYWOULDAPPEAR INTHE53ACCOUNTSWHEREASTHEmOWFROMTHE3AUDIENVIRONMENTTOTHE3AUDI ECONOMYWOULDBECAPTUREDINTHE3AUDIACCOUNTS!NOTHEREXAMPLEISlSHCAUGHT INNATIONALWATERSBYFOREIGNVESSELSTHISISAVERYSENSITIVEISSUEANDTHESUBJECTOF INTERNATIONALNEGOTIATIONS 2ESIDUALSPOLLUTANTEMISSIONS AREANOTHERPRIMEEXAMPLE4HEYAREALLOCATED
ACCORDINGTOTHERESIDENCEOFTHEENTERPRISEPRODUCINGTHEM4HUSTHEEMISSIONS FROMAN!IR&RANCEJETLANDINGIN3TOCKHOLMWOULDBEACCOUNTEDFORINTHE&RENCH PHYSICALmOWACCOUNTSNOTTHE3WEDISHONESBECAUSE!IR&RANCEISRESIDENTONLYIN &RANCEANDDOESNOTHAVEABASEOFOPERATIONSIN3WEDEN)NTHE&RENCHACCOUNTS THESEAREmOWSFROMTHENATIONALECONOMYTOTHE2/7ENVIRONMENTINTHE3WED ISHACCOUNTSTHEYAREmOWSFROMTHE2/7ECONOMYTOTHENATIONALENVIRONMENT /NCEINTHEENVIRONMENTRESIDUALSMAYCROSSNATIONALBOUNDARIES4HOSEDIS CHARGEDINTOTHEATMOSPHEREBYFACTORIESIN%NGLANDMAYBECARRIEDBYTHEWIND
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STRUCTUREOFTHECONVENTIONALMONETARYSUPPLYANDUSETABLESINTHE3.!4ABLES ARECONSTRUCTEDFOREACHOFTHEFOURTYPESOFmOWS.ATURALRESOURCESANDECOSYSTEM INPUTSHAVEUSETABLESONLYBECAUSETHEYAREINPUTSINTOTHEECONOMYUSES BUT ARENOTPRODUCEDBYTHEECONOMYSUPPLY .OTETHOUGHTHATTHEYMAYCOMEFROM EITHERTHENATIONALENVIRONMENTORTHE2/7ENVIRONMENT0RODUCTSANDRESIDUALS HAVEBOTHSUPPLYANDUSETABLES4HEFOURSETSOFmOWACCOUNTSCANTHENBEINTE GRATEDINTOASINGLESYSTEMOFPHYSICALmOWACCOUNTS 4HENEXTFOURTABLESSHOWTHESTRUCTUREOFTHESUPPLYANDUSETABLESFORTHEFOUR
DIFFERENTKINDSOFPHYSICALmOWS4HEYFOLLOWTHESTRUCTUREOFTHE3.!SUPPLYAND USETABLE4ABLE 4HESHADEDCELLSARETHOSETHATWOULDBElLLEDINFOREACH TYPEOFmOW 4HEUSETABLESFORNATURALRESOURCESANDECOSYSTEMINPUTSBOTHLISTTHEKINDSOF
INPUTSTHATAREUSEDINTHEECONOMY&ORNATURALRESOURCES4ABLE THISISRELA TIVELYSTRAIGHTFORWARDANDRELATIVELYQUANTIlABLE!NARRAYOFDIFFERENTINDUSTRIESUSE NATURALRESOURCESALTHOUGHRESOURCE BASEDINDUSTRIESARETHEMAJORUSERS &ORECOSYSTEMINPUTS4ABLE THETASKISMUCHHARDERBECAUSEMOSTOFTHE
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THEECOSYSTEMINPUTTABLESAGGREGATETHECONSUMPTIONOFHOUSEHOLDS.0)3(S ANDGOVERNMENTALTHOUGHTHEYCOULDPRESENTTHEMSEPARATELYIFTHEYWISHEDTO 4HEYDISAGGREGATEOWNACCOUNTTRANSPORTFROMALLOTHERUSESOFOXYGENHOWEVER 4HISREFERSTOTHETRANSPORTATIONUNDERTAKENBYINSTITUTIONSUSINGTHEIROWNVEHI CLESRATHERTHANHIRINGVEHICLESFROMlRMSINTHETRANSPORTATIONSECTOR4HEEMIS SIONSFROMOWNACCOUNTTRANSPORTCOMBUSTIONCANBECOMBINEDWITHTHOSEOFTHE TRANSPORTSECTORTOTRACKTHETOTALCOMBUSTIONRELATEDTOTRANSPORTATION4HISISAN IMPORTANTITEMINTHEDESIGNOFPOLICIESTOREDUCEVEHICLEEMISSIONS 4HEPHYSICALSUPPLYANDUSETABLEFORPRODUCTS4ABLE PARALLELSTHEMON
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ENTFROMTHOSEOFTHECONVENTIONAL3.!)NDUSTRIESANDlNALCONSUMERSPRODUCING WASTEPRODUCTSARECONSIDEREDTOBESUPPLIERSOFRESIDUALSASSHOWNINTHESUPPLY PORTIONOFTHETABLE)FBROKENDOWNINTOSUBSTANTIALDETAILTHISISWHEREFULLDATA APPEARONHOWMUCHPOLLUTANTOFEACHTYPEISEMITTEDBYEACHECONOMICACTIVITY WHICHISCLEARLYIMPORTANTINFORMATIONFORANARRAYOFPOLICYANALYSESANDDECI SIONS5NLIKETHEOTHERSUPPLYTABLESTHERESIDUALSTABLESINCLUDEACOLUMNFORCAP ITALASWELLASCOLUMNSFORINDUSTRYSECTORSANDCONSUMPTION2ESIDUALEMISSIONS FROMCAPITALARETHERESULTOFTHEGRADUALDECAYOFEQUIPMENTTHATWASDISCARDEDIN THEPASTINCLUDINGLEAKAGEFROMLANDlLLS4HEIMPORTSOFRESIDUALSHAVETWOCOM PONENTSTHEEMISSIONSGENERATEDBYNONRESIDENTSLIVINGWITHINTHEBOUNDARIESOF THECOUNTRYWHICHARELIKELYTOBEMADEUPLARGELYOFTRANSPORTATIONEMISSIONSAND CROSS BOUNDARYPOLLUTIONCOMINGINFROMOTHERCOUNTRIES 4HEUSETABLEFORRESIDUALSCOVERSONLYTHOSEEMISSIONSTHATENDUPBEINGREAB
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3UCHATABLEMAYBEUSEFULWHENTRACKINGALLOFTHEINFORMATIONABOUTAPARTICULAR
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MATERIALmOWACCOUNTING4HISWORKWHICHHASBEENPIONEEREDBYTHECOLLABORATIVE EFFORTOFAGROUPOFRESEARCHINSTITUTESINTHE5NITED3TATES%UROPEAND*APANGOES SOMEWHATBEYONDTHENATIONALINCOMEACCOUNTSSTRUCTURETOINCLUDEMEASURESOF CERTAINITEMSNOTCOVEREDBYPHYSICALmOWACCOUNTSINTHE3%%!!DRIAANSEETAL -ATTHEWSETAL )NADDITIONTOTRACKINGINPUTSOUTPUTSANDRESIDUALS ASTHE3%%!ACCOUNTSDOSUCHACCOUNTINGTRACKSMATERIALSMOVEDWITHINTHEENVI RONMENTINORDERTOACCESSNATURALRESOURCESSUCHASMININGOVERBURDENORSOIL EXCAVATEDDURINGCONSTRUCTION4HESEAREHIDDENmOWSINMATERIALmOWACCOUNT INGTERMINOLOGYANDTHEYCONSTITUTEONEOFTHEKEYSTRUCTURALDIFFERENCESBETWEEN MATERIALmOWACCOUNTS-&!S ANDTHE3%%!3OME-&!SALSOTRACKHIDDENmOWS GENERATEDDURINGTHEPRODUCTIONOFIMPORTSESTIMATINGTHEVOLUMESOFWASTEAND MATERIALSMOVEDINTHECOUNTRIESFROMWHICHIMPORTEDGOODSAREPURCHASED4HESE FOREIGNHIDDENmOWSARETERMEDTHERUCKSACK4HE-&!SSUMALLFOUROFTHESEmOWS INCLUDINGTHERUCKSACKACROSSSECTORSANDMATERIALSTOCALCULATETHETOTALMATERIAL REQUIREMENT4-2 OFTHEECONOMY4HISISINSOMESENSEANALOGOUSTO'.0INTHAT ITPROVIDESASINGLETOTALINDICATOROFmOWSINTHEECONOMY"ECAUSEITINCLUDESBOTH DOMESTICHIDDENmOWSANDINTERNATIONALRUCKSACKSHOWEVERITPROVIDESAMORE COMPREHENSIVEMEASURETHANTHE3.!INDICATOR 0HYSICALACCOUNTSCANGOBEYONDTHESUPPLYANDUSETABLESTOINCLUDEDEVEL
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