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ECONOMIES OF SCALE AND PROXIMITY FOR INFRASTRUCTURE
AND SERVICES: The concentration of population and enterprises
in urban areas greatly reduces the unit costs of providing each
building with piped water, good sanitation, drains, all-weather
roads and footpaths and electricity. This concentration greatly
reduces unit costs for many services such as garbage collection,
public transport, health care and the provision of schools, pre-school
centres and child development centres. It reduces the cost of providing
emergency services - for instance fire-fighting and emergency medical
services whose rapid response to acute illness or injury can greatly
reduce the health burden for the people affected. But even in tenement
areas and informal settlements with high population densities, the
densities are rarely too high to pose problems for the cost-effective
provision of infrastructure and services, especially if provision
for these had been made in advance of the settlement's development.
What is often more expensive and time consuming is installing infrastructure
and services in densely populated illegal or informal settlements,
after they have developed. These often grew without sufficient space
left for access roads, public space and community facilities and
without a site plan which makes it easier and cheaper to install
piped water, drains and other infrastructure. But this high cost
is not because of high population densities but because provision
for infrastructure and services of adequate standard for such population
densities was not made prior to the settlement's development. In
addition, there are many examples of community-directed programmes
that installed good quality infrastructure and services within existing
high density settlements at relatively low cost.
Box 3: Environmental economies of urbanization
In general, the costs per household of installing
most forms of infrastructure and supplying most kinds of service
fall with increasing population density - i.e. economies of proximity.
For instance, the cost of installing pipes for water, sewers and
drains and for building roads is cheaper because less pipe (and
less digging to install it) or less road is needed per house served
. For many forms of infrastructure and services, there are also
economies of scale because unit costs fall as larger populations
are served - for instance, for water treatment plants, schools and
many medical services. Providing more specialized medical and educational
services, including those for particularly vulnerable or disadvantaged
groups, can also become cheaper per person served with larger population
concentrations. Higher capital expenditures per person for infrastructure
and service provision in urban areas is more a reflection of higher
quality provision than higher costs; this only becomes a public
expenditure bias towards urban areas if the beneficiaries do not
pay the full cost. However, increasing population density can also
require that higher standards have to be provided - for instance,
well designed and maintained pit latrines can often provide hygienic
and convenient forms of sanitation in rural settlements and in urban
areas where population densities are not too high - but more expensive
systems are usually needed in higher density or larger urban settlements.
The costs of infrastructure and services may also rise with city
size, if the costs of acquiring land for their provision is a significant
part of the total cost. So too will labour costs, if the costs of
housing, transport and other necessities rise with city size (which
they often do). The need for more complex and sophisticated pollution
controls may also rise with increasing population size. For instance,
effluents from sewers and storm drains from a small urban centre
usually do not need as complex and expensive a treatment system
as those from larger cities. There are also the costs to the public
authorities of formulating and implementing environmental legislation
which may rise with city size (Linn 1982, World Bank 1991).
In discussing the >economies' scale, proximity
and agglomeration, it is important to be clear in regard to who
benefits (and who does not). Private enterprises benefit from many
economies of scale, proximity and agglomeration in urban areas;
indeed, one major reason why they choose to concentrate in urban
areas is because it lowers their production costs (including infrastructure
and finance and access to cheaper and more diverse services and
labour). But part of this may arise from the fact that they negotiate
highly subsidized infrastructure and services or other subsidies.
Part of their cost reductions often arise from their capacity to
pay below subsistence wages or to externalize costs - to the detriment
of their workforce (sub-standard occupational health and safety
standards) or wider populations (through inadequate pollution control
and waste management).
REDUCING RISKS FROM NATURAL DISASTERS:
Economies of scale or proximity also exist for reducing risks from
most natural disasters - for instance in the per capita cost of
measures to lessen the risks (e.g. better watershed management or
drainage reducing the scale of floods), reduce the risks when they
occur (e.g. buildings better able to withstand floods or earthquakes
and early-warning systems to allow special measures to be taken)
and respond rapidly and effectively when a disaster is imminent
or happens (International Federation of Red Cross and Red Crescent
Societies 1998). There is generally a greater capacity among city
dwellers to help pay for such measures, if they are made aware of
the risks and all efforts are made to keep down costs. However,
in the absence of good practice, cities can be particularly hazardous
as large (usually low income) settlements develop in hazardous sites
(e.g. on flood plains or slopes at risk from landslide) because
no other sites are available to them and as the needed prevention,
mitigation and response measures are not taken.
WATER RE-USE OR RECYCLING: The close
proximity of so many water consumers within cities gives greater
scope for recycling or directly reusing waste waters - and the techniques
for greatly reducing the use of freshwater in city homes and enterprises
are well-known, where freshwater resources are scarce (Rocky Mountain
Institute 1991) although it is agriculture, not cities, that dominate
the use of freshwater in most nations. Many nations also have a
long urban tradition of making efficient use of rainwater or of
storing it for use during dry seasons or periods which contemporary
patterns of water management have ignored (see for instance Agarwal
and Narain 1997 for India).
LAND: Cities concentrate populations
in ways that usually reduce the demand for land relative to population.
Although valuable agricultural land is being lost to urban expansion,
in most nations, the area taken up by cities and towns is less than
one per cent of their total surface area. The world's current urban
population of around 3 billion people would fit into an area of
200,000 square kilometres - roughly the size of Senegal or Oman
- at densities similar to those of high class, much valued inner
city residential areas in European cities (for instance Chelsea
in London). This is a reminder of how some of the world's most desirable
(and expensive) residential areas have high densities - including
densities that suburban developers and municipal authorities regard
as >too high' even though many such >high density' areas also
have good provision for parks, a diverse employment structure and
good cultural facilities. The fact that cities also concentrate
demand for fresh fruit, vegetables, fish and dairy products also
means considerable potential for their production in the area around
a city - especially if their promotion is integrated with a city-wide
and region-wide plan to protect watersheds, control urban sprawl,
encourage urban or peri-urban agriculture and ensure adequate provision
for open space. In many cities, this would support existing practices
as a significant proportion of the food consumed by city inhabitants
is grown within city boundaries or in areas immediately adjacent
to the built up areas - often with city wastes also used to fertilize
or condition the soil.
REDUCED AUTOMOBILE USE: Cities have great
potential for limiting the use of motor vehicles - which also means
reducing the fossil fuel consumption, greenhouse gas emissions and
air pollution that their use implies. This might sound contradictory,
since most of the world's largest cities have serious problems with
congestion and motor-vehicle generated air pollution. But cities
ensure that many more trips can be made through walking or bicycling.
They also reduce travel distances - which is one of the reasons
why cities developed. They make possible a much greater use of public
transport and make economically feasible a high quality service.
Thus, although cities tend to be associated with a high level of
private automobile use, cities and urban systems also represent
the greatest potential for allowing their inhabitants quick and
cheap access to a great range of locations, without the need to
use private automobiles.
POLLUTION CONTROL AND MANAGEMENT: Industrial
concentration in cities cheapens the cost of enforcing regulations
on environmental and occupational health and pollution control.
It cheapens the cost of many specialized services and waste-handling
facilities - including those that reduce waste levels or which recover
materials from waste streams for re-use or recycling.
FUNDING ENVIRONMENTAL MANAGEMENT: The
concentration of households and enterprises in cities makes it easier
for public authorities to collect taxes and charges for public services
while in prosperous cities, there is a larger revenue base, a larger
demand and a larger capacity to pay for services.
GOVERNANCE: The concentration of people
in cities can make easier their full involvement in electing governments
at local and city level and in taking an active part in decisions
and actions within their own district or neighbourhood.
GREENHOUSE GAS EMISSIONS: For most nations,
a high (and growing) proportion of their greenhouse gas emissions
are released within cities. If the scale of such emissions need
to be reduced to limit climate change and its deleterious consequences,
some of the most cost-effective means of limiting each nation's
emissions will be found in its cities.
It is the absence of effective city and municipal
governance that explains the serious environmental problems evident
in so many cities - serious environmental health problems, serious
problems of environmental degradation around them. These environmental
problems are not inherent to cities. Indeed, for most people, cities
provide the best possibility of combining high standards of living
and quality of life with less resource-intensive, pollution-intensive
consumption patterns. There is also considerable potential for employment
generation in most of the measures to ensure more healthy, resource-conserving,
waste minimizing cities. There is also convincing evidence that
robust economies and a high quality of life can be de-linked from
growing resource use, pollution and waste.
FAST GROWING CITIES: The environmental
problems that often accompany rapid urban growth are also not inherent
to cities or to fast urban expansion. Some cities that have grown
rapidly in the last 50 years have avoided most of the problems noted
above. For instance, Curitiba and Porto Alegre in Brazil are both
among the world's most rapidly growing cities in recent decades
yet have high quality living environments and innovative environmental
policies. One of these is Curitiba's much admired public transport
system based on express busways and feeder buses which has encouraged
comparable systems in many other cities. Citizens in Porto Alegre
enjoy a life expectancy and many indicators of environmental quality
that are comparable to those in West European cities - and also
a city government that is well known for its commitment to supporting
citizen participation, greater government accountability and good
public health and environmental management.
Considerations of urban problems need to be
turned from (often inaccurate) generalizations about the problems
to more consideration of local governance structures that can address
them and the kinds of national and international conventions or
agreements that encourage local action to address not only local
problems but contribute to the solution of global problems. The
need for improvements in urban areas to be rooted in local realities
is important from a development perspective and from an ecological
perspective. Here too, some powerful myths about where action is
most needed have to be confronted.
THE IMPORTANCE OF LOCALLY DETERMINED SOLUTIONS
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