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Module 1: Leontief's Input/Output Analysis

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Leontief's Input/Output Analysis - Lesson Summary

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The key points from this module are: The International Standard ISO 4040 sets out the methodology for life cycle analysis and provides a framework for carrying out environmental management or life cycle assessment, the principles and the framework. The life cycle analysis basic steps involved are compiled an inventory of relevant inputs and outputs, then for each of this, evolved the potential environmental impacts associated with these inputs and outputs and then interpret the results. The models can be classified depending on the purpose, the models can be also classified as top-down versus bottom-up, as simulation versus optimization and minimize the total sum of costs or minimize the emissions have maximized the revenue. The model presented is the input-output analysis and this was proposed by Wassily Leontief way back in the 1930s. he created a simple aggregate model of the world economy and divided it into developed countries and less developed countries, and then saw what would happen in terms of investments and pollution, and looking at the possibilities of trying to reduce pollution and the investments in the industry as well as in pollution. In an economy when we talk of several different sectors, an output of one sector is used in the other sectors and it is also then used to meet the final demand. The emissions intensity is the emission per unit of GDP and broke up the emission intensity into the difference in terms of the energy intensity of the GDP and the sectoral contribution to the GDP. In primary energy analysis, we compare different options based on the primary energy input for a given we will decide a certain amount of final energy service or final output which is required and for that we would compare these options and then will compare them based on the primary energy. From a CO2 viewpoint, it is better to go in for diesel and then you see the trade-offs. Diesel is costlier, from a societal viewpoint there are issues in terms of imports and energy security. From the option of CO2, the oil option is better. From a security option, the coal option is better. So, these are the kind of trade-offs which are there are in many of the cases. We can compare not just based on the energy, but then we can see, what is the relative scarcity and from an energy security point of view what is the trade-off between the fuels.