Abstract

On this project, we propose a carbon footprint accounting model at a firm level that resembles the commonly used consumer approach which is based on the input output model. Our model tracks firms’ emissions by assuming that the buyer seller relations among firms implicitly generates exchanges in emissions through the overall production processes. Consequently, the embodied emissions in firms’ production sold to final demand components consumption, investment, and exports summarizes their carbon footprint. Using the richness of administrative records, we trace the network of input output relations among Chilean firms and compute their direct and embodied emissions. Our results will allow us to disentangle how the emissions and carbon footprint differs by economic activity, firm size, exporting status, type of ownership, among other variables. This level of disaggregation contributes crucially to the development of public policies focused on how to address current environmental issues.