Land use and carbon emissions – LUCE

Land use and the distribution of economic activity are key determinants of a territory’s GHG emissions. Whether land is artificialized, used for agriculture, or covered with forests dramatically impacts the resulting emissions. The organization of the urban territory, such as the density and size of housing or the commuting distance to work have a comparable impact. In France, in 2022, according CITEPA data, 17% of national GHG emissions came from commuting, 13% from housing and 20% from agriculture. In turn, French forests are carbon sinks, they absorbed 7% of national emissions and a higher amount over 2010-2015, close to 15% and comparable to emissions from housing or commuting.

Key economic forces shape these different determinants of national emissions. For instance, a more productive agriculture frees up land that can be converted to cities, potentially increasing sprawl, but this land can also be regained by forests. While these different determinants of emissions have been largely studied separately, we propose an integrated approach where economic forces shape land use, commuting and housing choices across the entire territory to tackle the following main research questions: what are the mechanisms driving the spatial organization of land use and the related emissions? Which environmental policies could be implemented to mitigate land use related emissions?

To address these questions, LUCE builds French spatial data on land use, sectoral employment and emissions from original sources over long period and develops an integrated quantitative spatial model of land use and emissions ---- accounting for emissions from commuting, housing, industrial and agricultural production, but also storage in forests and fields. Equipped with original data and an estimated quantitative framework amenable to policy counterfactuals, the project aims at determining how different channels account for historical emissions in France since 1840 and what policy tools should be used at different stages of development to reduce them. The design of these policies is of crucial importance for global emissions as many emerging countries are expected to witness rapid urbanization in the future.

Using the quantitative integrated framework, LUCE provides evaluations for various land use and agricultural policies, in the aggregate and across space (e.g., boundaries to urban growth, conservation policies, subsidies to reforestation, EU Common Agricultural Policy). Importantly, as sectors compete for production factors, land and labor, they should be considered jointly for policy analysis. This integrated approach is deepened by investigating at a more granular spatial and sectoral level the role of forestry and agriculture for climate change resilience. Specifically, we distinguish the role of forests for timber production from their use as natural amenities. Doing so, LUCE studies the effects of local forest-conservation policies on land use and welfare, using reduced-form estimations together with model-based counterfactuals. Lastly, we also consider several agricultural sectors, separating crops from livestock, to better account for the effects of agricultural subsidies (e.g., Common Agricultural Policy) on agricultural productivity, welfare and the environment, in the aggregate and across French regions.