Boundary Issues: Calculating National Material Use for a Globalized World

Due to the global fragmentation of supply and use chains, final consumption and the production of goods and services are often spatially disconnected. A country in which a large share of material and energy use is dedicated to the production of exports may seem to consume more material than a country that imports material-intensive products. Material flow accounting (MFA) is a well-established tool within environmental accounting, and the indicators it provides are increasingly used to inform policy-making on sustainability issues. Growing trade volumes and the deeper integration of all economies into global markets have posed a new challenge to MFA: how can we expand the scope of the accounts from a production-based perspective to one that includes consumption? In this chapter, we discuss the recent additions to the MFA method that seek to allocate material use to those economies where final consumption occurs rather than to those economies producing for export. These approaches are illustrated with a case study of the Austrian economy. This case study compares material use in Austria under production- and consumption-based approaches.