A Welfare Evaluation of Green Urban Areas

Urban green areas cover more than 6% of urban land in Europe. This paper quan-tifies the impact of urban green areas on city structures for more than 300 Europeancities. It discusses the economic effects of the local amenity produced by green urbanareas using an urban economics model with various set of preferences. It estimatesthose models using data on detailed residential land uses, green urban areas and popu-lation density. It finally assesses the economic effects of reducing urban green areas incounterfactual exercises where cities are closed and open to migration and green urbanland is converted to residential plots or not. By this strategy, the economic assess-ment accounts for the general equilibrium effects through endogenous land prices andresidential space and location choices. It shows that the gross benefits of urban greenareas are substantial. A uniform removal of half of the urban green areas is equivalentto 6-9% reduction of household annual income. However, the conversion of those areasto residential plots brings a net gain of approximately 4%