Carbon emissions embodied in investment: Assessing emissions reduction responsibility through multi-regional input-output analysis

Investment makes an outstanding contribution to the global economy while significantly impacting on global carbon emissions. However, few attempts have been made to analyze temporal changes in historical emissions induced by investment, and it is difficult to determine which countries are responsible for emissions reductions. Here we investigate the evolution in the carbon emissions embodied in investment (ECI) at global and national levels with the Global Multi-regional input-output (GMRIO) model, aiming to address the question of "Who should be responsible for how much, when it comes to emissions reductions?". Our results show that global ECI increased by 72.4% from 1990 to 2021, with intermediate input structure being the key driver. Specifically, China, the United States and India had the highest ECI, and domestic investment level was responsible for promoting the growth of investment-related emissions. Improvements in emission intensity were the primary contributor to reductions. The construction, electrical and machinery, and transport equipment sectors were the leading sectors in shaping national investment-related emissions. To enable more effective reduction policies measures of ECI reduction, serious consideration should be given to technology cooperation and sharing.