Lall, Somik Vinay

Equitable Growth, Finance, and Institutions
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Urban economics, Public finance, Regional development, Infrastructure economics, Spatial analysis, Territorial development
Equitable Growth, Finance, and Institutions
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Last updated: January 23, 2024
Somik V. Lall is the World Bank’s global lead on territorial development solutions and a lead economist for urban development in its Global Practice for Urban, Resilience and Land. Mr. Lall joined the World Bank in 1999 and today is a recognized expert on job creation and productivity in cities, development of lagging areas, and enhancing economic outcomes with transport connectivity and advises national and sub-national governments on key policy issues. Somik has led the World Bank’s global research program on urbanization and spatial development and previously founded the Urbanization Reviews program. He leads a Global Solutions Group that focuses on developing spatially coordinated multi-sector investments to support development of specific areas.
Citations 55 Scopus

Publication Search Results

Now showing 1 - 10 of 67
  • Publication
    Vibrant Cities - On the Bedrock of Stability, Prosperity, and Sustainability
    (Washington, DC: World Bank, 2023-12-07) Lall, Somik V.; Kaw, Jon Kher; Shilpi, Forhad; Murray, Sally Beth
    How will the world’s developing cities become vibrant—capable of meeting the climate, social, and economic challenges of tomorrow? Vibrant cities offer firms and households high expectations for good returns on investments, for a sustainable and resilient future, and for dynamic and inclusive growth. Cities thrive not only by increasing incomes and wealth for a select few but by improving common welfare through the equitable provision of basic services and opportu¬nities. To do this, tomorrow’s vibrant cities will be: 1.Resilient and low carbon—Limiting greenhouse gas emissions, reducing vulnerability to climate related hazards, and rebounding from disasters and pandemics. 2.Inclusive—Meeting basic needs for all residents, while enabling all to aspire realistically to a bet¬ter life through investment in skills and through equitable access to job opportunities. 3.Productive—Driving economic growth, creating jobs, boosting incomes, and financing critical social and infrastructure investments. The report provides new evidence, analysis, and policy insights to advance green, resilient, and inclusive urban development—drawing on the latest thinking in spatial urban development and public economics. While spotlighting the Middle East and North Africa region (MENA), it offers general insights for city and country leaders around the world. In doing so, it lays the foundations to shore up our technical assistance and policy engagements for urban development in MENA and elsewhere through a new policy framework—inform, support, and protect.
  • Publication
    Subways and CO2 Emissions: A Global Analysis with Satellite Data
    (Elsevier, 2023-04-24) Dasgupta, Susmita; Lall, Somik; Wheeler, David
    This paper estimates a global CO2 emissions model using satellite data at 25 km resolution. The model incorporates industrial sources (including power, steel, cement, and refineries), fires, and non-industrial population-related factors associated with household incomes and energy requirements. It also tests the impact of subways in the 192 cities where they operate. We find highly significant effects with the expected signs for all model variables, including subways. In a counterfactual exercise estimating CO2 emissions with and without subways, we find they have reduced population-related CO2 emissions by about 50 % for the 192 cities and about 11 % globally. Extending the analysis to future subways for other cities, we estimate the magnitude and social value of CO2 emissions reductions with conservative assumptions about population and income growth and a range of values for the social cost of carbon and investment costs. Even under pessimistic assumptions for these costs, we find that hundreds of cities realize a significant climate co-benefit, along with benefits from reduced traffic congestion and local air pollution, which have traditionally motivated subway construction. Under more moderate assumptions, we find that, on climate grounds alone, hundreds of cities realize high enough social rates of return to warrant subway construction.
  • Publication
    Tracking Methane Emissions by Satellite: A New World Bank Database and Case Study for Irrigated Rice Production
    (World Bank, Washington, DC, 2022-11) Dasgupta, Susmita; Lall, Somik V.; Wheeler, David
    Atmospheric methane is a potent greenhouse gas that has accounted for 23 percent of radiative forcing in the lower atmosphere since 1750. Since methane has a much shorter atmospheric duration than carbon dioxide and other greenhouse gases, it provides a critical opportunity for near-term atmospheric greenhouse gas reduction. Thus, 122 countries have joined the recently launched Global Methane Pledge to reduce methane emissions at least 30 percent from 2020 levels by 2030. Unfortunately, the Pledge confronts a serious information problem at the outset: the near-total absence of directly measured data for problem diagnosis, program design, and performance assessment. At present, priority areas for emissions reduction are identified with spatially formatted “bottom-up” emissions inventories, such as the Emissions Database for Global Atmospheric Research, which combines sectoral activity data with broadly calibrated emissions factors from engineering studies. This paper addresses the information problem by introducing a new World Bank database of monthly atmospheric methane concentrations, calculated for a high-resolution spatial grid from data provided by the European Space Agency’s Sentinel-5P satellite platform. It illustrates the potential utility of the database with a global study of methane emissions from irrigated rice production, which accounts for about 10 percent of agricultural methane emissions. A comparative analysis suggests that the Sentinel-5P data supplement the Emissions Database for Global Atmospheric Research data with more fine-grained spatial information, which may support local programs to track, verify, and reward adoption of methane-reducing rice production techniques. If this approach proves valuable for irrigated rice production, it seems likely to work for other methane sources as well.
  • Publication
    Will the Developing World’s Growing Middle Class Support Low-Carbon Policies?
    (World Bank, Washington, DC, 2022-07) Kahn, Matthew E.; Lall, Somik
    As billions of people in the developing world seek to increase their living standards, their aspirations pose a challenge to global efforts to cut greenhouse gas emissions. The emerging middle class is buying and operating energy intensive durables ranging from vehicles to air conditioners to computers. Owners of these durables represent an interest group with a stake in opposing carbon pricing. The political economy of encouraging middle class support for carbon pricing hinges on offsetting its perceived negative income effects. Rising environmentalism in the developing world could also increase support for credible greenhouse gas reduction policy. This paper quantifies these effects by estimating Engel curves of durables ownership, comparing the grid’s carbon intensity by nation, and studying the demographic correlates of support for prioritizing environmental protection.
  • Publication
    Trucking Costs and the Margins of Internal Trade: Evidence from a Trucking Portal in India
    (World Bank, Washington, DC, 2022-05) Lall, Somik; Shilpi, Forhad
    This paper uses data on nearly half a million actual shipments from a trucking portal in India to provide evidence on how trucking costs depend on route characteristics and affect the intensive and extensive margins of shipment flows. The empirical analysis using pre-pandemic data (before March 24, 2020) confirms the presence of thick market externalities along a route and spillovers across routes due to network externalities, both of which confer advantages to origins and destinations with larger market sizes. The paper utilizes exogenous variations in value-added tax on gasoline across states to provide causal estimates of the elasticity of shipment flows with respect to trucking costs. The empirical estimates suggest that a 1 percent increase in trucking unit costs reduces trade flows by 2.8–3.9 percent. On the extensive margin of trade, three eastern states and several smaller territories constitute isolated regions that were largely cut off from the trading networks during the pre-pandemic period. Trucking costs increased by 32 percent during the early post-lockdown period (June 2020 to February 2021). The increase was greater along longer routes. In the short run, the increase in freight rates led to a proportionate decrease in trade flows across states. It pushed a significant number of poorer and remoter states into the ranks of isolated regions.
  • Publication
    Place, Productivity, and Prosperity: Revisiting Spatially Targeted Policies for Regional Development
    (Washington, DC: World Bank, 2022-01-21) Grover, Arti; Lall, Somik V.; Maloney, William F.
    Place matters for productivity and prosperity. Myriad factors support a successful place, including not only the hard infrastructure such as roads, but also the softer elements such as worker skills, entrepreneurial ability, and well-functioning institutions. History suggests that prosperous places tend to persist, while “left-behind” regions—or those hurt by climatic, technological, or commercial shocks—struggle to catch up. This division gives rise to demands to “do something” about the subsequent spatial inequality. Such pressures often result in costly spatially targeted policies with disappointing outcomes because of a lack of analysis of the underlying barriers to growth and structural transformation and a fair appraisal of the possibility of overcoming them. The latest volume of the World Bank Productivity Project series, Place, Productivity, and Prosperity: Revisiting Spatially Targeted Policies for Regional Development makes three broad contributions. First, it provides new analytical and empirical insights into the three drivers of economic geography—agglomeration economies, migration, and distance—and the way in which these drivers interact. Second, it argues that these forces are playing out differently in developing countries than they have in advanced economies: urbanization is not accompanied by structural transformation, leaving cities crowded and accruing all the negative aspects of urbanization without being concentrated productively. Long-term amelioration of poverty in lagging regions requires advancing the overall national agenda of structural change and productivity growth. Third, it provides a heuristic framework with which to inform policy makers’ assessments of place-based policy proposals, helping them identify the regions where policy is likely to have an impact and those that would remain nonviable. The framework enables governments to clarify the implications of various policy options; to think critically about design priorities, including necessary complementary policies; and to navigate the implementation challenges.
  • Publication
    Urban CO2 Emissions: A Global Analysis with New Satellite Data
    (World Bank, Washington, DC, 2021-11) Dasgupta, Susmita; Lall, Somik; Wheeler, David
    This paper estimates an urban carbon dioxide emissions model using satellite-measured carbon dioxide concentrations from 2014 to 2020, for 1,236 cities in 138 countries. The model incorporates the global trend in carbon dioxide concentration, seasonal fluctuations by hemisphere, and a large set of georeferenced variables that incorporate carbon dioxide–intensive industry structure, emissions from agricultural and forest fires in neighboring areas, demography, the component of income that is uncorrelated with industry structure, and relevant geographic conditions. The income results provide the first test of an Environmental Kuznets Curve relationship for carbon dioxide based on actual observations. They suggest an environmental Kuznets curve that reaches a peak near or above $40,000 per capita, which is at the 90th percentile internationally. The research also finds that economic development has a significant effect on the direction of the relationship between population density and carbon dioxide emissions. The relationship is positive at very low incomes but becomes negative at higher incomes. The paper also uses cities’ mean regression residuals to index their carbon dioxide emissions performance within and across regions, decomposes model carbon dioxide predictions into broad source categories for each city, and uses the regression residuals to explore the impact of subway systems. The findings show significantly lower carbon dioxide emissions for subway cities.
  • Publication
    Agglomeration Economies in Developing Countries: A Meta-Analysis
    (World Bank, Washington, DC, 2021-07) Grover, Arti; Lall, Somik V.
    Recent empirical work suggests that there are large agglomeration gains from working and living in developing country cities. These estimates find that doubling city size is associated with an increase in productivity by 19 percent in China, 12 percent in India, and 17 percent in Africa. These agglomeration benefits are considerably higher relative to developed country cities, which are in the range of 4 to 6 percent. However, many developing country cities are costly, crowded, and disconnected, and face slow structural transformation. To understand the true productivity advantages of cities in developing countries, this paper systematically evaluates more than 1,200 elasticity estimates from 70 studies in 33 countries. Using a frontier methodology for conducting meta-analysis, it finds that the elasticity estimates in developing countries are at most 1 percentage point higher than in advanced economies, but not significantly so. The paper provides novel estimates of the elasticity of pollution, homicide, and congestion, using a large sample of developing and developed country cities. No evidence is found for productivity gains in light of the high and increasing costs of working in developing country cities.
  • Publication
    Pancakes to Pyramids: City Form to Promote Sustainable Growth
    (World Bank, Washington, DC, 2021-05-31) Lall, Somik; Lebrand, Mathilde; Park, Hogeun; Sturm, Daniel; Venables, Anthony; Lebrand, Mathilda
    Towns and cities are economic and social microcosms in which large numbers of people and firms interact. These interactions largely shape how a city looks, how it functions, and how it grows. But how exactly does this many-sided relationship work? What are the specific drivers of urban economic and spatial development? Pancakes to Pyramids brings us closer to answering these questions, beginning with an idealized contrast between two patterns of urban spatial growth. Pancakes are cities that grow outward and remain relatively low-built. Pyramids are cities that grow partly outward, but also partly inward and upward, filling vacant parcels and adding height to central districts to increase economic and residential densities. Both types of density can help cities overcome the challenges that come with population growth, and most urgently, evolving from a pancake into a pyramid, creating a platform with more options for controlling greenhouse gas emissions. This report draws on new evidence, econometric analysis, and predictive modeling to relate the economic growth of cities to their past spatial evolution, and to the possibility and conditions for future pyramidal growth.
  • Publication
    The Evolution of City Form: Evidence from Satellite Data
    (World Bank, Washington, DC, 2021-04) Lebrand, Mathilde; Lall, Somik V.; Soppelsa, Maria Edisa
    This paper describes new global evidence—derived from satellite data—for rates and patterns of urban spatial development since 1990 along three margins: horizontal spread (outward extension), infill development (inward additions in the gaps left between earlier structures), and vertical layering (upward construction). The end product of this growth is floor space, the amount and distribution of which are central to understanding how a city becomes livable and sustainable. Over the quarter century between 1990 and 2015, urban built-up area worldwide grew by 30 percent through horizontal spread and infill. While most cities grow through a combination of horizontal spread and infill, the paper provides the first estimates of the relative prominence of each type of expansion at different stages of economic development. In low-income and lower-middle-income countries, 90 percent of urban built-up area expansion occurs as horizontal spread. The study also finds that increasing incomes are a uniquely necessary condition for a rise in floor space per person through vertical layering: the reason is that building tall is capital intensive. The analysis highlights that if a city’s population doubles but incomes stay constant, the city’s floor space per person declines by 40 percent; by contrast, if per capita income doubles but population stays constant, the city’s total floor space per person increases by 29 percent.