The Structural Tansformation of Land and the Carbon Balance

Land use and the geographic distribution of economic activity are key determinants of a territory’s emissions of greenhouse gases. Emissions depend on whether land is built-up in cities, used for agriculture, or covered with forests. In cities, emissions depend on the extent of sprawl. We develop a quantitative spatial theory of land use where different sectors compete for land. Technological and demographic evolutions trigger structural change and shape land use, commuting and residential choices. Emissions change as a result. We estimate the quantitative model using French spatial data since 1950 across sectors. The estimation delivers novel insights on the determinants of land use and emissions across space and time and allows to evaluate the effect of technological change and agricultural policies on welfare, productivity and the environment.