Macro-Economic Multi-Objective Input-Output Model for Minimizing CO2 Emissions: Application to the US Economy

Designing effective environmental policies for mitigating global warming is a very challenging task that requires detailed knowledge of the international channels through which goods are traded. This work presents a decision-support tool that minimizes the environmental impact at a global macroeconomic scale by performing changes in the economic sectors of an economy. Our tool combines multi-objective optimization, environmentally extended input-output tables and life cycle assessment within a unified framework. Our results on the U.S. economy to minimize CO2 emissions identify sectors that should be regulated first to reach a given environmental target while maximizing the demand satisfaction. The impact of shale gas on our results is also studied. Our findings show that the application of process systems engineering tools at a macroeconomic level can provide valuable insight for public policy makers into problems of general interest. (C) 2016 American Institute of Chemical Engineers AIChE J, 62: 3639-3656, 2016