Reassessing the threshold at which urbanization can slow or accelerate climate change in developing countries

The rapid urbanization of developing countries poses a paradoxical challenge to climate policy while cities can stimulate innovation and efficiency, they also concentrate emissions and vulnerable populations. This study addresses the critical question of whether threshold effects exist in the relationship between urbanization, population growth and climate outcomes. This could inform more targeted policy interventions. Specifically, we examine the levels at which urbanization transitions from climate mitigation to acceleration in developing countries. Using a Threshold Generalized Method of Moments model, we analyse panel data from 74 developing countries between 1995 and 2021, focusing on climate vulnerability and carbon dioxide emissions as the dependent variables. Our methodology identifies critical breakpoints at which urbanization and demographic factors significantly alter their impact on climate outcomes. The results reveal distinct threshold effects with important policy implications. Urbanization reduces climate vulnerability below a 13% urban population share, but increases carbon dioxide emissions beyond a 37% urban population share. Population growth accelerates vulnerability and emissions above 56% and 37%, respectively. Gender analysis shows that men increase emissions, whereas women reduce them. Both urbanization and population growth elevate mortality rates and reduce life expectancy across all examined thresholds. These findings contribute to the existing literature by quantifying the specific threshold levels at which urbanization shifts from providing climate benefits to imposing climate burdens. Identifying these breakpoints enables policymakers to implement targeted interventions before critical limits are reached. Our results suggest that developing countries should priorities the integration of information and communication technology, artificial intelligence applications and green transition policies to optimise the benefits of urbanization while minimizing climate risks. This threshold-based approach offers a novel framework for climate resilience.