Reconsidering the economy-wide implications of incorporating the resource costs of waste management in Scottish input-output accounts

In this paper, we build on a previous and incomplete Scottish study by Allan et al. (2007) that made a key methodological contribution in operationalising the Leontief (1970) environmental input-output model to consider the need to determine social and/or resource costs of supplying common resources such as a ‘clean environment’ at a local or regional level. At the same time, Allan et al. (2007) acknowledged that poor data hindered complete testing of Leontief (1970) environmental input-output model. For this reason, this paper revisits and expands on the development made by Allan et al. (2007) using improved data and applies the model to incorporate the resource implications of negative externalities from waste generation into the economic process. This is with the aim to answer some key policy issues including identifying whether the polluter pays for waste management and who ultimately bears the resource costs for waste disposal and management within the economy. We argue that this approach may be useful for policy if, for example, a ‘polluter pays’ scenerio is considered relative to one where government retains some commitment to pay for waste management.