The Economics of Green Cities

The Economics of Green Cities Programme examined the risk-adjusted costs and benefits of green policy frameworks on the sustainable economic growth of cities in different parts of the world. The purpose was to provide robust, evidence-based recommendations for policy-makers and other stakeholders. In particular, the two key questions that the Programme  examined were:

1. Economic rationale. What is the economic rationale for cities to undertake early-action green policies in developed and developing countries?

2. Policy analysis. Which programmes, institutions and tools are most promising for policy makers to implement, measure and monitor green city policies?

The Programme focused on the effects of early action versus delayed action green policies. Currently, there is a lack of rigorous analysis of early mover advantage in the transition to green city economies. The Programme examined the economic impacts of innovation, new technologies and new markets that are created by early versus delayed action.

The Economics of Green Cities Programme also took an integrated approach to the green economy. While discrete sectoral approaches are useful for national and international policy making, city policy strategies require a particularly strong integrated approach. For example, planning decisions that lock in urban form, such as the layout of buildings, transport routes and green space affect the policy options available, or required, for reducing carbon emissions and air pollution, promoting innovation clusters and attracting professional workers and companies to the city. The Programme used integrated economic methods to examine the most promising policy instruments, financing models and partnerships that can maximise the net benefits of investing in green infrastructure and technology.

The programme published the Stockholm: Green Economy Leader Report in June 2013, the first in a series of reports investigating policy frameworks and green economic performance in a global selection of leading cities. A second report for the City of Copenhagen was published in May 2014.

A scoping paper was also published in September 2016, with C40 Cities. The paper undertook a review of the literature and data on urban co-benefits to climate action in order to map the current landscape of understanding, use and availability of data and produces recommendations to inform further work on co-benefits.

Nicky Gavron (Greater London Authority) acted as an advisor to this project.