Economic Structure and Strategies for Greenhouse Gas Mitigation

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Economic Structure and Strategies for Greenhouse Gas Mitigation
Erin S. Minihan ( and Ziping Wu (
Agricultural and Food Economics

Agri-Food and Biosciences Institute (AFBI) and Queen’s University of Belfast


Greenhouse gas (GHG) emission mitigation policy impacts the economic system directly in the short-term by altering relative prices and indirectly in the long-term by shifting the structure of the economy. Long term changes in economic structure will also depend on factors related to economic development such as population, consumption patterns, and global markets. The effectiveness of specific mitigation policy regimes will need to take account of long term changes in economic structure. Using input-output analysis, this study links economic development with its environmental effects, developing a new measure to indicate the technical cost of GHG mitigation under economic growth in an economy. The measure advances from traditional Input-output (IO) analysis and a linear programming based sensitivity analysis developed by Moran and Gonzalez (2007). Using Northern Ireland as an example, the result shows an isoemission surface / matrix of economic development for an economy. The flexibility and transparency of the approach provides a useful tool for the development of GHG mitigation strategy.

JEL classification: Q53; Q56; Q58; C61; C67

Key words: GHG mitigation; IO analysis; linear programming; isoemission matrix; technical cost of GHG mitigation; Northern Ireland

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