The social footprint—a practical approach to comprehensive and consistent social LCA

Work-place related impacts (e.g. health, labour rights violations, discrimination, missing pay and social security) can best be expressed in relation to working time, while impacts on the community (e.g. corruption, underemployment, missing tax and infrastructure payments) can best be expressed in relation to value added (Weidema 2006b).

Income includes both direct income as wages or entrepreneurial profit and indirect income via tax transfers, which together sum up to the value added.

It is an interesting question whether some of the difference in productivity should be ascribed to climate or other local conditions, also in a situation without externalities. Evidence presented by Dell et al. (2008) shows an effect of temperature on aggregate productivity for poor countries, but not for rich countries. Rather than a direct causal relationship between temperature and productivity, the adverse temperatures appear to aggravate other causes for low productivity. The question is therefore if such differences would persist in a situation without externalities (and therefore also without limitations on the movement of labour and with adequate income to provide temperature adaptation). If indeed they should persist, they would be related to variation in the work-leisure preference, i.e., the extent to which leisure is preferred to work or vice versa, and while such variation may affect the per capita GDP, it does not affect the productivity per work hour, which is what we are concerned with here. The same argument can be applied to any cultural differences in productivity that may remain after all externalities have been internalised.

The 21 % is calculated from a wage for household workers of 2.325 USD and 1312  h of unpaid work for each of the 73.7 % of the population above 15 years (Worldbank 2015).