Op-Ed

Cities and climate change
Syed Yusuf Saadat
22 Oct,2018

Urbanisation is escalating worldwide. Hence cities are becoming increasingly crucial in dealing with climate change. According to UN Habitat, cities contribute to 70 percent of global greenhouse gas emissions whilst occupying only two percent of the world's land. Thus, urban areas are disproportionately responsible for climate change. This problem is projected to become more acute in the future.

UN Habitat estimates suggest that 60 percent of the world population will live in urban areas in 2030. While on the one hand, cities can be potential drivers of climate change, on the other hand, they can also be potential victims. This is because the consequences of climate change, which include rising sea levels and extreme weather events, can directly endanger cities. 

In the case of Bangladesh, the urbanisation process can be explained using the two-sector surplus labour model, also known as the Lewis model. Lewis envisaged the developing economy as characterised by dualism, in the form of a rural agricultural sector and an urban industrial sector. In the initial stages of development, the rural agricultural sector is large in size, uses traditional technology, and employs family workers on implicit wage akin to a “work-sharing-output-sharing” basis. The producers in this sector are subsistence farmers who carry out production mainly for their own consumption, and not for the market. The capital per worker in the rural agricultural sector is low, so the productivity of labour is low. The implicit wage paid to workers is equal to the average product of labour, and is relatively low compared to the urban industrial sector. Since there is a vast pool of surplus labour in the rural agricultural sector, the marginal product of labour is zero, and workers can be extracted without reducing the total output of the sector.

On the other hand, the urban industrial sector is small in size, uses modern technology, and employs hired workers on explicit wages. The producers in this sector are capitalists who carry out production with the sole intention of maximising profit through sales in the market. The capital per worker in the urban industrial sector is high, so the productivity of labour is high. The explicit wage paid to workers is equal to the marginal product of labour, and is relatively high compared to the rural agricultural sector. There is no surplus labour in the urban industrial sector, so the marginal product of labour is positive.

The rural-urban wage differential acts as an incentive for workers to migrate from the rural agricultural sector to the urban industrial sector. This process not only drives urbanisation, but also facilitates structural transformation of the economy. Transferring labour from the low-productive rural agricultural sector to the high-productive urban industrial sector increases overall output with no loss to the agricultural sector. This is because the marginal product of surplus workers is zero. In the urban industrial sector, total output exceeds the total cost of production which results in positive profit. This profit is immediately and fully reinvested into the business by the capitalist. The capital stock thus increases, which increases the demand for labour. More workers are attracted to the urban industrial sector from the rural agricultural sector. According to Lewis, this process will continue until all the surplus labour in the rural agricultural sector has been transferred to the urban industrial sector. This is when a country will reach a state of development, according to Lewis.

If one ponders upon the Lewis model, then its climate change implications become immediately obvious. While structural change may be conducive to development, it is detrimental to the environment. Urbanisation is accompanied by an increase in industrialisation and per-capita energy consumption, both of which exacerbate climate change. As people move into cities, each person's carbon footprint increases. Soon we reach a juncture where the accumulation of these enlarged footprints creates a huge dent in environmental quality.

Bangladesh's economy is also undergoing structural change in its development journey. According to International Labour Organization's (ILO) estimates, in 1991 the share of agriculture in employment in Bangladesh was 69.5 percent, whilst the share of services in employment was 16.9 percent. However, in 2018, the share of agriculture in employment is projected to decline to 37.6 percent, whereas the share of services in employment is projected to increase to 41 percent. With such a trend in structural change, Bangladesh faces the threat of high temperature and increased greenhouse gas emissions.

Climate change is an existential threat to mankind. The problem is so significant, and the probable consequences of inaction so catastrophic, that procrastination in taking action to address this issue could be suicidal for humanity. In light of this, the following recommendations should be taken into account by policymakers and urban planners: (i) engage broader stakeholders and conduct a vulnerability assessment study to identify adaptive capacities of cities; (ii) identify issues, convert them to objectives, and mainstream climate change issues into urban planning; (iii) prioritise adaptation options through a clear implementation framework that integrates into existing policies, whenever practical and feasible; (iv) develop a monitoring and evaluation system to measure the implementation progress, and weigh up actions against objectives.

Cities contribute to and are affected by climate change. Therefore, by incorporating climate change considerations into our city planning and development, we can mitigate the adverse effects of urbanisation and design sustainable cities of the future.


Syed Yusuf Saadat is a research associate at the Centre for Policy Dialogue (CPD).