Wednesday, March 14, 2007

Kahn, On Green Cities


Green Cities: Urban Growth and the Environment
Matthew E. Kahn, Brookings Institution Press, 2006.

Matthew E. Kahn is a Professor at the Institute of the Environment at UCLA. He blogs on environmental and urban topics at greeneconomics.blogspot.com.

To read Chapter One of this book go here.

My “Green Cities” book was published in September 2006. Now that six months have past, I can look back at the entire experience and reflect. I learned that I am not a good writer. I learned that writing a book for a wide audience is much harder than writing a single academic article. I learned that I vastly over estimated my book’s sales potential. I had dreams of competing with Freakonomics for a slot in the New York Times Book Review. I had thought that my blog would feature stimulating debates between me and my book’s readers. Now, I would settle for some double digit royalty checks! The book’s cumulative sales right now are a little over 1000.

But, permit me to boast just a little bit. I like my book. It has a cool cover image that I suggested to Brookings. Even my mother and my mother in-law like my book. The book has made the 2007 Planetizen Top Ten list. My friends, who have read the book, have said nice things about it. To offer one convenient example see this. Three different Nobel Laureates sent me kind notes telling me how much they liked the book. In writing this book, I owe a great debt to the Brookings Institution Press. The Press and my editor, Mary Kwak, greatly helped me in writing a high quality book.

A good friend of mine told me that I made a mistake with my book’s title. He told me that to enhance sales it should have been titled: “Green Cities: Economic Growth and the Environment”. I would like to use the remainder of my time posting here to explain why I made my “urban” choice.

My book is a “two handed” empirical debate between optimists (think of Julian Simon) and pessimists (think of Paul Ehrlich) concerning the question of whether economic growth mitigates or exacerbates environmental problems. Since, I know very little about agriculture or ocean natural resources, I intentionally wanted to limit the sphere of my discussion. I view myself as an environmental and urban economist and thus wanted to devote my book’s attention to how urban quality of life is affected by economic growth.


Why should urban planners read my book? I would hope that planners are thinking about the “business as usual” scenarios of what will happen to land patterns and transportation patterns if they enact no new policies. I would hope that planners are thinking about what negative externalities are being exacerbated under the status quo. Only if you have a good model in your head of how pollution is evolving over time in a particular city that you care about, can you then address the issue of “are my plans making a difference for improving environmental sustainability in this city?” Kent Portney wrote a powerful book a few years ago titled Taking Sustainable Cities Seriously. In this excellent book, he presents original empirical work documenting which cities (such as Santa Monica) engage in active environmentally friendly policies. The next step for urban planners is to attempt to establish whether such policies have a causal effect in increasing urban sustainability. To recover credible estimates of such “treatment effects” requires thinking about the counter-factual of what would Santa Monica’s environmental sustainability have been in the absence of the green policies that Portney pinpoints.


A Sketch of the Book’s content

Chapter Two begins by providing three different ways of judging a city’s overall “environmental sustainability”. Should we focus solely on the city’s per-capita ecological footprint? Should we use a public health criteria? Should we simply examine home prices? Los Angeles would score high on the 2nd and 3rd criteria but not on the first. Cairo might score high on the first one but not on the 2nd or 3rd. Clearly, how a person prioritizes different environmental challenges such as local air pollution versus climate change plays a key role in determining which sustainability metric you embrace.

Starting in Chapter 3, I get down to business in studying economic growth’s sustainability consequences. Economic growth bundles three attributes; 1. rising per-capita income, 2. population migration to cities, 3. population and job decentralization (i.e sprawl) within cities. Throughout my book I define cities = metropolitan areas and only discuss at certain parts of the book the issues that center cities face.

The pessimistic case for why economic development degrades the environment is obvious and hinges on scale effects. If everyone in Beijing grows rich and substitutes from walking to work to driving a Hummer, then the air will be polluted and greenhouse gas production will skyrocket. My book is quite honest about measuring the size of these effects and discussing what we know and don’t know.

Potentially offsetting such consumption based scale effects is the fact that richer cities engage in more regulation to mitigate environmental externalities. Richer people are willing to spend more to preserve and enhance local quality of life. In addition, the industrial composition of these cities shifts away from dirty manufacturing toward clean services (think of Pittsburgh over the last 40 years or New York City which has lost hundreds of thousands of manufacturing jobs in recent decades). In this chapter, I also discuss the role of technological advance in mitigating pollution per dollar of output. While predicting future technological progress is risky business, recent economic research on the induced innovation hypothesis has some important points to make. Put simply, increases in energy prices directs research and development to products (such as the Toyota Prius) that economize on energy.

In Chapter Six, I discuss how urban population growth affects urban sustainability. A key issue is whether this growth is anticipated or not and whether government is up to the job of scaling up infrastructure. I also take on the pessimistic claim in the social capital literature that immigration often increases urban diversity and this leads to collective action problems as heterogeneous population free rides and disagrees over what is the right tax and public goods services to offer for the city as a whole.

Chapter Seven address sprawl. As I have documented in several publications, when people live and work in the suburbs they do not use public transit. Hence, the suburbanization of jobs and workers has undermined public transit in the United States.

Chapter Eight turns to the topic of climate change and urbanization. There are really 2 issues here. Does urbanization exacerbate greenhouse gas production? Second, how will climate change affect different types of cities? While this is a 8 page chapter, I believe that I do a good job sketching out many of the big issues and I’m actually planning to expand this chapter into a full book in the near future!

To conclude, I am quite confident that undergraduates who care about cities and the environment will learn from my book. I’m using it in my spring 2007 courses at UCLA. My book is strong at reviewing the best econometric research over the last 20 years in environmental economics. Similar to Freakonomics, I work hard to boil down the insights from these academic papers so that anybody can understand what are the big ideas that environmental and urban economics have been working on.

One prominent economist has told me that I wimped out
. He said that I didn’t write a strong “bottom line” on whether Development “greens” or “browns” cities. He also said that I didn’t offer strong policy prescriptions for building a green city. He is right about both points. I am optimistic that economic development eventually causes reductions in pollution where the costs are felt locally such as local ambient air pollution. I am less optimistic that economic development mitigates global externalities such as greenhouse gas production. Clearly, we need a collective action solution (a world permit trading market) to help address the climate change mitigation issue. With regards to policy prescriptions, there is too much cross-city heterogeneity for me to declare what are the key “ingredients” for building a green city. The economist in me would argue that polluters must face the social costs of their actions and when they do the aggregate effect is a greener city.

If we just slept in our beds 24 hours a day --- this would be a green city but as we commute, work, shop and travel and consume electricity these actions add up and we have urban pollution. I’m fascinated by the deep question of how do we design incentives to mitigate the tension between high per-capita material well being and high environmental quality?

1 comment:

John Carruthers said...

I read Matt’s book, and I liked it a lot – I think it’s an excellent book for urban and regional planners to read. Many of us get into the field because we have strong feelings about the way cities “ought to be” – I have always thought that this is one (among other) of the things that make it so great to be a part of. That said, as a result, we tend to be a highly self-selected group that views activism / intervention as fundamental to the vitality of cities. This makes us very good at identifying and taking aim at problems like environmental degradation, but, sometimes, less open to thinking dispassionately about how they arise and when best to address them. For this reason, I think that some readers may feel frustrated by the Matt’s more positivistic approach and view his lack of prescriptive commentary as a shortcoming. But, as he says above – Green Cities provides a great model for thinking about the environmental trajectory of urbanization and, in that way, provides important insights into how and when urban and regional planning can play a role in improving things. For example, a cornerstone of the EKC hypothesis is that greater wealth – attended by education and income – leads to greater demand for environmentally friendly consumption and policies. It seems to me then, that a key component of any urban environmental policy should be some kind of social policy aimed at achieving more equity and integration in our urban areas. And this is exactly he kind of thing that planners do best – think comprehensively about the complex connections that tie so many urban problems together and, in turn, develop and apply solutions for them. When I read the book, a question that came to mind was how to tie its findings into more normative planning-oriented theory, like Lynch’s theory of Good City Form. That work lays out very specific criteria for gauging the extent to which development patterns serve the best interests of their inhabitants, and I think books like Green Cities can inform that discussion in a direct way.

 

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