Mediterranean Economies 2023
DOI: 10.1401/9788815411167/c10
The first target concerns the
quality of living. As per the 2030 Agenda, the SDG11.1 target defines it as necessary to
identify and quantify the proportion of the population that live in slums, informal
settlements and those living in inadequate housing in order to inform the development of
the appropriate policies and programmes for ensuring access for all to adequate housing.
Public transport is the focus of SDG11.2. Agenda 2030 aims to provide safe access to
public transport facilities, regardless of gender and age. The third target concerns the
governance of urban and territorial transformation in order to limit uncontrolled urban
sprawl. SDG11.4 is about the protection of natural and cultural heritage. SDG11.5 is
dedicated to the exposure of urban settlements to natural hazards, also related to
climate change and measured in terms of number of deaths, those missing
¶{p. 336}and people directly affected, and economic loss and damage to
critical infrastructure. The sixth target concerns water and air pollution. SDG11.7
concerns open built-up spaces in cities, their accessibility and safety and security.
Agenda 2030 suggests a set of
indicators chosen by expert groups to monitor the achievement of the SDG’s targets, on
the basis of in-depth analyses and reviews of the scientific literature. In order to
meet the objective of this contribution and to cope with the lack of up-to-date and
reliable data, sentinel proxy indicators were identified in order to compare base and
post Russia-Ukraine war scenarios.
In order to depict the
sustainability path of Mediterranean coastal cities through the lens of urban
development we compared the following indicators (source: NUMBEO)
between 2021 and 2022:
– The Pollution
Index is based on several indicators such as air pollution (concentration
of PM2.5 and PM10), water pollution, accessibility, noise and light pollution, green and
park quality, and waste disposal management.
– The Crime
Index is an estimation of overall level of crime based on the number of
crimes committed and the perception of danger of contributors to the website. It goes
hand in hand with the Safety Index which is, instead, an estimation of the overall level
of safety.
The selected indicators are not
adequate to describe the sustainability pattern of the selected cities but given their
temporal variability they can quantify appreciably the possible effects of the
Russian-Ukrainian war on building sustainable cities and society.
3. SDG 11 and economic sustainability
The current geo-political crisis of
the Russian-Ukrainian conflict and its economic consequences have seriously jeopardized
the ability to tackle the daunting global challenge of sustainability. The ongoing war
has led to a spike in energy and basic commodities prices in Europe and beyond,
contributing, amongst other things, to a global supply chain crisis, to unsustainable
production in the sectors hardest hit, and resulting in runaway inflation worldwide [Del
Lo et al. 2022; Kuzemko et al.
¶{p. 337}2022; Liadze et al. 2022]. However, the
paradigm of sustainable development takes the form of an urgent and decisive response to
be implemented in order to ensure economic recovery and strengthen the resilience of
economies.
Given the rapid and growing pace of
urbanization on a global basis
[1]
, and the social, environmental and economic repercussions of this phenomenon
[2]
, investigation of progress towards sustainable development at urban level
emerges as an important topic for researchers and policy makers. In this chapter we seek
to explore to what extent the current economic shock resulting from the Russian and
Ukrainian conflict may affect the chances of Mediterranean cities succeeding on their
sustainable development course, comparing their socio-economic conditions before and
after the conflict. As part of Agenda 2030 signed by the member countries of the United
Nations, Sustainable Development Goal (SDG) 11 aims to build «Sustainable cities and
communities». A more equitable urban environment can make a decisive contribution to the
transition process towards sustainability. Ensuring universal access to basic services,
a more «affordable» life for all citizens and reducing inequalities are essential tasks
for making cities more inclusive and sustainable. Citizens can act as agents of
structural change towards sustainable development, but only if suitable pre-conditions
exist to do so. For this purpose, we embed the environmental analysis within the study
of the social and welfare dimension, adopting an integrated approach, in order to assess
the overall advancement of Mediterranean cities towards sustainable urban development.
Empirical research from urban economics has found that, besides environmental
conditions, such as the level of pollution, that greatly influence human health and
therefore the quality of life, other factors, like the local purchasing power, cost of
living and level of rent have a significant impact on the quality of life of cities,
which can be recognized as a general ¶{p. 338}expression of reasonable
and good living conditions existing in locations [Ali, Audi and Al-Masri 2022]
[3]
.
A society that is less inclusive in
terms of social participation and welfare can hinder the achievement of environmental
sustainability goals: low-income householders have less access to basic necessities such
as health care, alternative water sources, or housing options, which are useful tools
for reducing or avoiding the impact of exposure to environmental harms [Maguire and
Sheriff 2011].
The target 11.1 states that, by
2030, access for all to adequate, safe and affordable housing and basic services and
upgrade slums’ must be ensured. The lack of affordable housing options and access to
essential services for low-income households could prevent cities undertaking a more
sustainable pattern [Smets and Van Lindert 2016]. It is considered a priority issue to
establish housing policies targeting the most vulnerable segments of the population at
the bottom of the income scale [UN 2022].
Although the price of renting
accommodation is considered one of the most important indicators for determining the
living quality of citizens [Shapiro et al. 2006; Aragonés, Amérigo
and Pérez-López 2017], average wage, cost of utilities and other variables should also
be taken into account to properly assess citizens’ quality of life.
According to Albouy and Lue [2015],
local wage levels, housing costs (or price of renting) and commuting costs, which vary
substantially between and within cities, affect householders’ ability to lead an
affordable life and hence the average local disposable income. Wages play a fundamental
role in ensuring a better quality of work-life and promoting social welfare: a wage
level able to guarantee access to affordable primary and basic amenities means that work
can act as a driving element of a sustainable livelihood and collective well-being for
citizens.
Mutual interactions between wages
and quality of (work) life fuel welfare and sustainability of cities: higher average
wages and a better quality of work allows not only productivity and
¶{p. 339}efficiency improvements in the local labour market and
individual welfare gains for workers, but also a socially «healthier» local environment
[Carr et al. 2018] leading to sustainable cities [Gargiulo and De
Ciutiis 2010].
Based on this idea, we can
calculate some useful indicators to proxy cost-of-living affordability as a dimension of
quality of life in the cities. We establish the apartment rent to wage ratio as a
measure of housing affordability, comparing the monthly average rental costs with the
average monthly net salary for each city
[4]
.
Rent costs are considered a fuller
measure of the «urban costs» faced by households [Albouy and Lue 2015]: if the rental
cost is very high compared to the average wage, it means that those who receive lower
wages would have less money available to spend on other primary needs such as food,
health care and transportation [School Harvard Kennedy 2019]. For this reason, we extend
the apartment renting price to wage ratio by adding the cost of different basic
amenities, attempting to capture the cost of living. The concept of a living wage has
its roots in the origins of economic thought, and it has been subject of regulation by
state and supra-state legislation in recent years. It can be basically defined as the
wage that is supposed to provide workers’ basic needs, such as food, housing and
clothes, and services, such as transportation, but also the possibility to participate
in cultural and social life [Schulten and Muller 2019].
Affordable public transportation is
one of the important issues in the living wage also tackled by SDG target 11.2,
concerning the provision of safe, affordable and sustainable transport systems by 2030.
In fact, «only about half the world’s city dwellers have convenient access to public
transportation» [UN 2022].
Given that this conflict has
seriously affected the fuel prices of the economies under study [Kalogiannidis
et al. 2022], it is necessary to include the cost of gasoline
(per litre), adjusted for inflation, in our analysis to evaluate the impact of this
crisis on transport price trends, that can affect the well-being and sustainability of
cities. However, the fuel price will be analysed ¶{p. 340}separately and
not be included as part of the living wage since (1) there is no estimation of the
average km that people usually drive and (2) it interacts with other variables in the
living wage.
Additionally, good quality public
transportation is more important for long-run sustainability.
In addition to the indicators
created to capture the effects of the Russian-Ukrainian conflict on urban
sustainability, we would like to see whether national regulations on the minimum wage
can help to control the effects of conflict. In fact, according to Standing [2011] and
Carr et al.[2018], jobs can also be unsustainable however, for
instance if a legal minimum wage falls below the basic cost-of-living. The provision of
minimum wages by force of law should fulfil its designated role in allowing full-time
workers to afford the basic cost of living [Dube and Lindner 2021] and to enjoy an
adequate, minimum standard of living [Schulten and Muller 2019], carrying out the task
of «protecting» above all the lowest wage earners and reducing wage inequality. For this
reason, we include the minimum and average wage ratio, the so-called Kaitz index, as a
measure which is able to capture the effects of introducing a minimum wage and
differences in wage dispersion across our sample cities. We take into account the
state-level minimum wages of each city. In this way, we can evaluate whether the minimum
wage established at national level corresponds to the desirable one, in cities that
have, for example, higher living costs.
– Rental house
affordability is the price of renting a one-bedroom apartment relative to
the average monthly net salary (after tax). Since data about household income are not
available and family structure can be different by city, we focus on the affordability
of one-room apartments with one salary. The average price of renting a one-bedroom
apartment is calculated as the mean of the price of renting an apartment in the city
centre and the price of renting outside the centre.
– Living costs
to the monthly wage ratio is the sum of utilities expenditure, including the monthly
local transport pass for, as well as the price of renting relative to the monthly wage.
The purpose of this indicator is to
provide a tool for evaluating affordability at the minimum subsistence level, that is
the degree at which the wage level is needed to meet the basic needs of citizens. Thus,
we include the price of renting a one-room apartment in the rental house affordability
indicator.
¶{p. 341}
Note
[1] «Today, more than half the world’s population live in cities. By 2050, an estimated 7 out of 10 people will likely live in urban areas» United Nations [2022, 48].
[2] The United Nations highlights the greater challenges of growing urban development as «shortage of affordable housing, insufficient infrastructure (such as public transportation and basic services), limited open spaces, unsafe levels of air pollution, and increased climate and disaster risk» (ibidem).
[3] They provide empirical evidence about a negative and significant relationship between the local level of pollution, traffic, rent and quality of life index among some selected 42 big Asian cities, while the local purchasing power in buying goods and services in a market is positively and significantly associated with it.
[4] Disposable income, i.e. net wage, represents the money that a person has available to spend on daily costs. Additionally, taking into account after-tax wages should help us to control better for wage dispersion across areas compared to pre-tax wages [Winters 2009].