Consumption-based (CB) emission accounting is considered to be the solution to tackle current limitations of the production-based (PB) emission accounting scheme, especially in addressing the concerns for carbon leakage, where the accusation implies that developed countries simply relocate their emissions abroad by shifting their productions in foreign countries and re-importing them for domestic consumption. The main part of this thesis analyzes the relationship between the output of goods and import of goods for decoupled countries. By analyzing their relationship, we try to see if there is a portion of evidence suggesting that decoupled countries decoupled their PB emissions from GDP by substituting domestic demand with imported goods. Beside this main set of variables, we also analyze PB emission and CB emission data to confirm their relationship to output and import. Before we analyze the main part in the second step of our research, we also analyze the dynamic for countries which have decoupled in the given time frames, 1995-2010 and 1995-2014, as well as the dynamic between PB emission growth and CB emission growth in the time frame of 1995-2010/11 in the first part of our research. We found that more countries decoupled in 1995-2014 than in 1995-2010 and most of countries that have decoupled are member of Annex B countries. Furthermore, for most decoupled OECD countries, the CB emission growth is still above PB emission growth. To the main part of the research, we have always found significant relationship between output and import. The majority of relationships lie in either a negative growth of output with an increase in import, or a negative growth in output with a decrease in import. Therefore, we could not conclude that most of the decoupled countries are decoupled because they substitute domestic produced goods with imported goods. Additionally, the relationship between import and CB emission is significant where majority of the datasets lie in the category of positive growth of import with a positive increase of CB emissions and the category of positive growth of import with a decrease in CB emissions.

Acknowledgements i
Abstract ii
List of Figures v
List of Tables vi
List of Abbreviations vii
1. Introduction and the Main Purpose of the Research 1
2. Background and Literature Review 4
2.1 Decoupling and Climate Change 4
2.2 Pros and Cons to Shift from Production-based (PB) to Consumption-based (CB) Accounting Schemes 6
2.2.1 Pros 6
2.2.2 Cons 8
2.2.3 Implementation Possibilities 10
2.3 Carbon Leakage 10
3. Data and Methodology 13
3.1 Wiebe and Yamano’s PB and CB emission Data (1995-2011) 13
3.1.1 Decoupled Countries in 1995-2010 and 1995-2011 14
3.1.2 Dynamic of PB and CB Emission Growth in 1995-2010 and 1995-2011 15
3.1.3 Relationship Between the Three Sets of Variables for Decoupled Countries in 1995-2010 and 1995-2011 15
3.2 CAIT and IEA PB Emission Data (1995-2014) for Extension of Countries and Length of Period 20
4. Empirical Results and Discussion 23
4.1 Decoupled Countries in W&Y and CAIT/IEA Database (1995-2010/11 v.s. 1995-2014) 23
4.2 Dynamic of PB growth and CB growth (only available from 1995-2010/11) 26
4.3 Results of Relationships Between the Three Sets of Variables 31
4.3.1 First set of variables: PB growth and output growth 31
4.3.2 Second set of variables: Output from goods-producing activities and goods imported 31
4.3.3 Third set of variables: import growth and CB emission growth 38
5. Summary and Evaluation 39
6. Conclusion 46
7. Bibliography 48
8. Appendix 52
A List of countries included in this study 52
B List of countries decoupled 53
C Dynamic analysis of PB growth and CB growth 54
C.1 OECD Countries in W&Y database: PB growth and CB growth in 1995-2010/11 54
C.2 non-OECD Countries in W&Y database: PB growth and CB growth in 1995-2010/11 55
C.3 All Countries in W&Y database: PB growth and CB growth in 1995-2010/11 56
D Example of how relationship of significance and linear regression model is displayed in our research results 57
D.1 Second set of variables (normalized): annual percentage growth of output from goods-producing activities v.s. annual percentage growth of import from goods imported 58
D.2 Third set of variables (not normalized): annual growth of imported goods v.s. annual growth of CB emission 59
D.3 Third set of variables (normalized): annual percentage growth of import from imported goods v.s. annual growth of CB emission 60
9. Affidavit 61

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