Category Archives: economy
In the 21st century cities have increasingly adopted sustainability as a guiding principal, offering a window of opportunity for the incorporation of urban agriculture into city land use planning efforts. In addition, the engagement of commercial urban farms with local economies has allowed urban agriculture to enter the realm of economic development. Despite these advancements, many still frame their understanding of urban agriculture as interim land use while waiting for appropriate real estate development to happen. In his 2014 thesis, Andrew Cook (MCP ’14) argues the sustainable development characteristics of urban agriculture can only be accessed by treating it as permanent rather than a temporary land use.
To illustrate his argument, Andrew draws on a case study of Baltimore City, specifically the temporary use on city-owned land programs: Adopt-A-Lot and Homegrown Baltimore Land Lease Initiative. Andrew traced the historical relationship of urban agriculture to city development, Baltimore’s shrinking population, Baltimore’s policy environment as well as the histories of each program. He found that Baltimore’s view that urban agriculture runs counter to the economic growth objectives of a city, has limited the sustainability, economic, environmental and social benefits of urban agriculture projects. Through his evaluation of several urban commercial farms, community farms and demonstration farms, Andrew provides an alternate view, showing how urban agriculture can drive rather than hindering economic development. He offers a series of recommendations that woucl allow cities to realize the maximum benefit of urban agriculture. To learn more, read Andrew’s full thesis here.
The great variety of services that natural systems provide is rarely recognized. From water filtration to flood prevention to carbon sequestration, these ecosystem services are crucial to supporting both natural and human life. The cost of preserving these services is often far eclipsed by the cost of replacing them mechanically should they be lost, a point that is rarely appreciate economic markets. What can be done to correct this and ensure that natural systems continue to provide their much-needed benefits?
In his dissertation, Tijs van Maasakkers (PhD ’13) examines one solution that has been eagerly advanced in environmental circles: the ecosystem services marketplace. Similar to other environmental markets like carbon cap and trade schemes, ecosystem services markets are based on the idea that a developer who is likely to damage the ability of natural systems to provide their full benefits would have to pay for improvements elsewhere to offset these impact. In an early example, increases in water temperatures in Oregon’s Tualatin River threatened the survival of a number of local salmon species, a problem often corrected at great expense mechanically by chilling wastewater before releasing it. Instead, the local water utility opted to offer incentives to local landowners to plant shade trees along the river’s banks, cooling the river naturally, effectively, and at a lower cost.
If implemented well, ecosystem services markets could allow for continued economic progress without sacrificing natural systems. But, as Tijs shows in his study of efforts to create ecosystem services markets in the Willamette River basin and in the Chesapeake Bay, such markets are difficult to develop and face three important structural obstacles.
First, people care deeply about particular places, and tend not to view the services that are provided in one place as transferrable to another. Second, metrics that account for ecosystem services are not yet consistent, comprehensive, and universally accepted. Third, it has been difficult to establish a consensus among effected stakeholders about what these markets should look like.
These obstacles limit the potential of ecosystem services markets, and if they cannot be addressed, it is difficult to imagine how markets can be scaled up. Read more about the promises and pitfalls of ecosystem service marketplaces in Tijs’ dissertation.
Encouraging energy efficiency among residents and businesses is hard work, not least because of the absence of accessible and easily understandable information about energy consumption. Most people don’t understand everything on their energy bills, don’t know if they’re using more energy than they should, and have no way to compare their energy use to that of their neighbors. This information is often guarded closely by utilities, presenting energy efficiency advocates with a formidable barrier.
In her thesis, Alexis Howland (MCP ’13) sketches the possibilities afforded by better energy consumption data. She surveyed efforts across the country to share energy efficiency data. Alexis focuses on incorporating these data into mapping applications—which could lay bare the differences in energy consumption among homes and add valuable information to the housing market. These efforts could be combined to allow no-touch energy assessments that offer actionable suggestions for homeowners who want to improve their energy efficiency.
In a survey of five previous attempts at energy mapping, Alexis notes a common theme: the developer’s inability to access or make public energy consumption data at the household level. This, Alexis explains, is due to privacy concerns that have so far prevented such data from being used to its full potential.
Alexis explores ways of unleashing these data. Several cities—including Boston—have recently passed ordinances that require the disclosure of energy consumption data, and the federal government has offered a framework for voluntary energy data disclosure through the Green Button Initiative. While these efforts must overcome serious privacy concerns, they have the potential to make public vital information about the way people and buildings nationwide use energy. Read more about Alexis’ survey of the opportunities for and barriers to energy mapping projects in her thesis.
Our natural systems are increasingly threatened by climate change, droughts, increasing population, and related crises. These coming crises will have massive economic impacts, and firms will soon need to learn how to operate in a setting where resources are constrained and old business models are no longer competitive.
Aleyn Smith-Gillespie (MCP/SM 2001), now an associate director at Carbon Trust, recently contributed to an Economist report on the future of business models in a constrained world. Aleyn notes that, for many products where the cost of ownership is high and the rate of utilization low, businesses have an opportunity to recognize resource constraints by shifting away from an ownership economy and towards a sharing or subscription-based one.
Many proactive businesses have already begun to move in this direction, by emphasizing shared ownership of under-utilized resources (like cars and industrial machinery) and advertising services over products.
As these new business models succeed and resource constraints continue to strangle the old economy, Aleyn expects this shift to become more pronounced. Read more about Aleyn’s take on his guest blog at the Economist, or download the full Economist report, Supply on Demand.