Material Flows and Physical Input-output Tables - PIOT for Denmark 2002 Based on MFA

Industrial growth and rising population strain the global environment and allocation of material resources. As we all know, most changes, if not all, in the environment are brought about by human activities. These activities result in a flow of materials. A full understanding of this process demands a complete understanding of the physical dimension of the economy. Economy Wide – Material Flow Accounts (EW-MFA) linked to the more detailed Physical Supply-Use Tables (PSUT) and Physical Input- Output Tables (PIOT) can be used for such a purpose. Statistics Denmark has in 2002 constructed EW-MFA including some aggregate indicators on a pilot-project basis (Gravgård Pedersen 2002). The accounts and indicators were established for the years 1981, 1990 and 1997. In 2005 Statistics Denmark made use of these experiences to construct a regular production system where EW-MFA input indicators (DMI and DMC) for the period 1993-2002 were compiled (Mulalic 2005). Statistics Denmark has in 1999 constructed PIOT for Denmark for the year 1990 on a pilot-project basis. PIOTs were constructed for ten different product groups, including PIOT for all commodities (Gravgård Pedersen 1999). The aim of this project is to show how the overall EW-MFA indicators and accounts (cf. Eurostat, 2001) can be linked – and how they relate to - the more detailed PSUT and PIOT, which are in accordance with the SEEA 2003 (Integrated Environmental and Economic Accounting, United Nations et. al., 2003). The report includes also a description of a more or less automated system for the construction of detailed PIOT from extended PSUT, which are directly in concordance with EW-MFA. The PIOT are drawn up for the year 2002. The objectives of this report are: 1. A description of the methodological work on combining the EW-MFA with an underlying detailed database and system for flows within the economy; 2. A presentation of a detailed PIOT for Denmark 2002, with a detailed description of the procedure for fast construction from physical supply and use tables and automatic balancing procedures; and 3. Bridge tables 2002 showing the relationship between EW-MFA and detailed PIOT. Chapter 2 summarises the conceptual foundation of material flow accounts and balances based on the SEEA 2003. In chapter 3, the basis for the economy-wide MFA is described. Indicators derived from the accounts are also described in the same chapter. Chapter 4 contains the description of construction of PIOT, using extended PSUT based on the MFA accounts compiled after SEEA 2003 principles. First part of the chapter describes extended PSUT and data sources and methods used for its construction. Furthermore, the automatic balancing method is presented. Finally, construction of the PIOT from balanced extended PSUT is explained. Chapter 5 contains a PIOT for Denmark for the year 2002 based on all commodity flows. In chapter 6, main economy-wide MFA indicators are presented, including bridge tables showing the relationship between EW-MFA and the detailed PIOT.
Keyword: EW-MFA, PIOT, cross ntropy