Abstract
Defense spending has a large impact on public welfare initiatives. This chapter demonstrates that the defense industry has both direct and indirect carbon impacts. Using the United States, China, France, the United Kingdom, and Russia as examples, we examined the demand- and supply-side effects of their defense spending on their respective economies’ carbon emissions between 2005 and 2009. Our findings revealed that the United States, Russia, and Germany had the highest direct defense industry emissions. Russia had the most carbon-intensive sector of all the countries studied, with a 2005 value of 9.87 t/$104 and a 2009 value of 5.72 t/$104. Nonetheless, between 2005 and 2009, the carbon intensity of the defense sector fell in every country, resulting in lower emissions for the vast majority of countries. Our findings also reaffirmed the defense sector’s monopsonical or oligopsonical nature, with the majority of emissions incorporated into the government’s final demand. In addition to the conventional demand-side estimates, our supply-side analysis revealed that the United States’ (9.75 and 4.61%), Russia’s (4.11 and 4.70%), and Germany’s (4.03 and 2.91%) defense sectors contributed the most to worldwide supply-driven emissions in 2005 and 2009, respectively. Further examination of the defense sector’s demand-driven downstream and supply-driven upstream carbon linkages revealed that intrasectoral purchases and sales were the most significant source of demand-driven downstream and supply-driven upstream carbon linkages for all countries. Meanwhile, the second largest source of both upstream and downstream carbon links was “Electricity, Gas, and Water Supply.” The presentation of the demand- and supply-side carbon impacts of the defense sector can inform public policy and support the UN’s 2030 Sustainable Development Goals (SDGs) 1 and 2 (poverty eradication), SDG 3 (climate action), and SDG 16 (peace and justice). In particular, as the primary purchaser or user of defense sector products and services, the government can influence emissions not only through policy initiatives but also by reducing its final demand. Additionally, improvements in the way the defense sector uses power within the sector, such as its “Electricity, Gas, and Water Supply,” can be targeted to reduce the defense sector’s direct and indirect carbon impacts.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
Monopsony refers to a market in which there is only one buyer. Oligopsony is the term given to a market in which there are only a few very large buyers (OECD 2002).
- 2.
In this study “Public Admin and Defence; Compulsory Social Security” sector is used as a proxy for the log-run fear industry’s environmental effects. For ease of presentation the “Public Admin and Defence; Compulsory Social Security” is referred to as defense sector throughout this chapter.
- 3.
The majority of governments support global trade in arms in order to achieve what are called “scale economies” (Price Water House Coopers 2005).
- 4.
A Matrix is also referred as inter-industry, intermediate demand, technology matrix and direct requirement matrix in related literature.
- 5.
WIOD provides separate intermediate matrixes for domestic and imported goods. So, no further treatment of \(A\) matrix is required to separate domestic from intermediate imported demand for calculation of country’s total economic output.
References
Ali Y (2015) Measuring CO2 emission linkages with the hypothetical extraction method (HEM). Ecol Ind 54:171–183
Bildirici M (2017) The effects of militarization on biofuel consumption and CO2 emission. J Clean Prod 152:420–428
Bryan R, Grant J, Miranda P (2021) How does defense spending affect economic growth? RAND Corporation, Santa Monica. Retrieved from https://www.rand.org/content/dam/rand/pubs/research_reports/RRA700/RRA739-2/RAND_RRA739-2.pdf
CAAT (2011) An introduction to arms trade. Campaign Against Arms Trade, London
Cai J, Leung P (2004) Linkage measures: a revisit and a suggested alternative. Econ Syst Res 16:65–85
Chen G, Hadjikakou M, Wiedmann T (2017) Urban carbon transformations: unravelling spatial and inter-sectoral linkages for key city industries based on multi-region input–output analysis. J Clean Prod 163:224–240
Chenery H, Watanabe T (1958) International comparisons of the structure of production. Econometrica 4:487–521
Clements B (1990) On the decomposition and normalization of interindustry linkages. Econ Lett 33:337–340
Closson S (2013) The military and energy: moving the United States beyond oil. Energy Policy 61:306–316
Dietzenbacher E (1997) In vindication of the Ghosh model: reinterpretation of a price model. J Reg Sci 37:629–651
Duarte R, Sánchez-Chóliz J, Bielsa J (2002) Water use in the Spanish economy: an input_output approach. Ecol Econ 43:71–85
Fajgelbaum PD, Khandelwal AK (2016) Measuring the unequal gains from trade. Q J Econ 131:1113–1180. https://doi.org/10.1093/qje/qjw013
Fiott D (2014) Reducing the environmental bootprint? Competition and regulation in the greening of Europe’s defense sector. Organ Environ 27:263–278
Ghosh A (1964) Experiments with input-output models. Cambridge University Press, London
Guerra A, Sancho F (2010) Measuring energy linkages with the hypothetical extraction method: an application to Spain. Energy Economics 32:831–837
Hübler M, Pothen F (2017) Trade-induced productivity gains reduce incentives to impose strategic tariffs. Econ Model 61:420–431. https://doi.org/10.1016/j.econmod.2016.11.006
Isard W (1990) Progress in global modeling for world policy on arms control and environmental management. Conflict Manag Peace Sci 11:57–94
Joe M (2022) How war impacts climate change and the environment: few things fuel the climate crisis quite like war. Retrieved 3 Sept 2022, from Global Citizen. https://www.globalcitizen.org/en/content/how-war-impacts-the-environment-and-climate-change/
Khan SAR, Qianli D (2017) Impact of green supply chain management practices on firms’ performance: an empirical study from the perspective of Pakistan. Environ Sci Pollut Res 24:16829–16844. https://doi.org/10.1007/s11356-017-9172-5
Khan SAR, Ibrahim RL, Al-Amin AQ, Yu Z (2022a) An ideology of sustainability under technological revolution: striving towards sustainable development. Sustainability 14(8):44155. https://doi.org/10.3390/su14084415
Khan SAR, Umar M, Asadov A, Tanveer M, Yu Z (2022b) Technological revolution and circular economy practices: a mechanism of green economy. Sustainability 14(8):4524. https://doi.org/10.3390/su14084524
Khan SAR, Yu Z, Farooq K (2022c) Green capabilities, green purchasing, and triple bottom line performance: leading toward environmental sustainability, vol 32, no 4, pp 2022–2034. https://doi.org/10.1002/bse.3234
Khan SAR, Yu Z, Umar M, Zia-Ul-Haq HM, Tanveer M, Janjua LR (2022d) Renewable energy and advanced logistical infrastructure: carbon-free economic development. Sustain Dev 30(4):693–702. https://doi.org/10.1002/sd.2266
Kytömäki E (2014) The defence industry, investors and the arms trade treaty. The Royal Institute of International Affairs, Chatham House
Leontief W (1936) Quantitative input and output relations in the economic system of the United States. Rev Econ Stat 18:105–125
Liao H, Andrade C, Lumbreras J, Tian J (2017) CO2 emissions in Beijing: sectoral linkages and demand drivers. J Clean Prod 166:395–407
Miller R, Lahr M (2001) A taxonomy of extractions. In Miller R, Lahr M (eds) Regional science perspectives in economic analysis: a Festschrift in memory of Benjamin H. Stevens, pp 407–441. Elsevier Science, Amsterdam
Miller R, Blair P (2009) Input-output analysis: foundations and extensions, 2nd edn. Cambridge University Press, New York
OECD (2002) Glossary of stastical terms. Retrieved 13 Apr 2018, from https://stats.oecd.org/glossary/detail.asp?ID=3265
Perobelli F, Faria W, Vale V (2015) The increase in Brazilian household income and its impact on CO2 emissions: evidence for 2003 and 2009 from input–output tables. Energy Econ 52:228–239
Price Water House Coopers (2005) The defence industry in the 21st century. Retrieved 14 Apr 2018, from https://www.pwc.pl/en/publikacje/defence_industry_ads.pdf
Srinivasa RM, Rashmi L (2006) Mental health consequences of war: a brief review of research findings. World Psychiatry 5:25–30
Ramos T, Melo J (2005) Environmental management practices in the defence sector: assessment of the Portuguese military’s environmental profile. J Clean Prod 13:1117–1130
Ramos T, Alves I, Subtil R, Melo J (2007) Environmental performance policy indicators for the public sector: the case of the defence sector. J Environ Manage 82:410–432
Rocchi P, Serrano M, Roca J, Arto I (2018) Border carbon adjustments based on avoided emissions: addressing the challenge of its design. Ecol Econ 145:126–136. https://doi.org/10.1016/j.ecolecon.2017.08.003
Sajid MJ (2021) Continued increases in military and police spending can lead to economic collapse. E3S Web Conf 03036. https://doi.org/10.1051/e3sconf/202125303036
Sajid MJ, Rahman MH (2021) The Nexus between environmental impact and agricultural sector linkages: a case study of Pakistan. Atmosphere 12:1200. https://doi.org/10.3390/atmos12091200
Sajid MJ, Cao Q, Kang W (2019a) Transport sector carbon linkages of EU’s top seven emitters. Transp Policy 80:24–38. https://doi.org/10.1016/j.tranpol.2019.05.002
Sajid MJ, Li X, Cao Q (2019b) Demand and supply-side carbon linkages of Turkish economy usinghypothetical extraction method. J Cleaner Prod 264e275. https://doi.org/10.1016/j.jclepro.2019.04.234
Sajid MJ, Shahani NM, Ali M (2019c) Calculating inter-sectoral carbon flows ofamining sectorvia hypothetical extraction method. J Mining Environ (JME) 10:853–867. https://doi.org/10.22044/jme.2019.8263.1701
Sajid MJ, Gonzalez ED, Danish (2021) The role of labor and capital in sectoral CO2 emissions and linkages: the case of China, India and the US. Ecol Indic 108241. https://doi.org/10.1016/j.ecolind.2021.108241
Sajid MJ, Yu Z, Rehman SA (2022) The coal, petroleum, and gas embedded in the sectoral demand-and-supply chain: evidence from China. Sustainability 188. https://doi.org/10.3390/su14031888
SIPRI (2010) SIPRI yearbook 2010. Retrieved 14 Apr 2018, from https://www.sipri.org/sites/default/files/2016-03/SIPRIYB10summary.pdf
Song Y, Liu C, Langston C (2006) Linkage measures of the construction sector using the hypothetical extraction method. Constr Manag Econ 24:579–589
Strakos J, Quintanilla J, Huscroft J (2016) Department of defense energy policy and research: a framework to support strategy. Energy Policy 92:83–91
The World Input-Output Database (2022) Retrieved 5 Sept 2022, from World Input-Output Database. https://www.rug.nl/ggdc/valuechain/wiod/wiod-2013-release
Tian J, Lumbreras J, Andrade C, Liao H (2017) Key sectors in carbon footprint responsibility at the city level: a case study of Beijing. Int J Clim Change Strat Manag 9:749–776
Timmer MP (2015) An illustrated user guide to the world input-output database: the case of global automotive production. Rev Int Econ 23:575–605
Timmer MP, Erumban AA, Los B, Stehrer R, Vries GJ (2014) Slicing up global value chains. J Econ Perspect 28:99–118. https://doi.org/10.1257/jep.28.2.99
Wang Y, Wang W, Mao G, Cai H, Zuo J, Wang L, Zhao P (2013) Industrial CO2 emissions in China based on the hypothetical extraction method: linkage analysis. Energy Policy 62:1238–1244
Zhang J, Yu B, Cai J, Wei Y-M (2017) Impacts of household income change on CO2 emissions: an empirical analysis of China. J Clean Prod 157:190–200
Zhao Y, Zhang Z, Wang S, Zhang Y, Liu Y (2015) Linkage analysis of sectoral CO2 emissions based on the hypothetical extraction method in South Africa. J Clean Prod 103:916–924
Author information
Authors and Affiliations
Rights and permissions
Copyright information
© 2023 The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.
About this chapter
Cite this chapter
Khan, S.A.R., Sajid, M.J., Zhang, Y. (2023). An Application of the Long-Term Fear Industry Theory to Environmental Impacts. In: Emerging Green Theories to Achieve Sustainable Development Goals. Industrial Ecology. Springer, Singapore. https://doi.org/10.1007/978-981-99-6384-3_9
Download citation
DOI: https://doi.org/10.1007/978-981-99-6384-3_9
Published:
Publisher Name: Springer, Singapore
Print ISBN: 978-981-99-6383-6
Online ISBN: 978-981-99-6384-3
eBook Packages: Business and ManagementBusiness and Management (R0)