4 and cities, we contribute to literature on the characteristics of the urbanization process globally, and in the developing world in particular. Urban areas only account for _∼_ 40% of global volumes and international volume differences. Given that urban residents typically consume less space per capita than rural residents, urbanization should reduce space consumption per capita. At the same time, many nations and cities have low levels of space consumption per capita, implying that they may need to build more vertically and/or horizontally. Studies have shown how historically crowded the cities of many developing countries are (Castells-Quintana, 2017; Jedwab et al., 2017; Jedwab and Vollrath, 2019). Many developing countries are also “urbanizing without growth” (Fay and Opal, 2000; Fox, 2012; Jedwab and Vollrath, 2015; Gollin et al., 2016; Fox and Goodfellow, 2016; Castells-Quintana and Wenban-Smith, 2020). At the same time, meeting global construction needs could have dramatic environmental consequences. There are thus trade-offs between promoting housing affordability and ensuring livability/sustainability.

There is then the question of whether it is more optimal to meet construction needs by building upward or outward. Verticality is associated with compact and economically dense cities (Lall et al., 2021; Ahlfeldt et al., 2023; The World Bank, 2023b), which favors economic efficiency and innovation as shown by a large literature on agglomeration economies (Duranton and Puga, 2004; Castells-Quintana and Royuela, 2014; Combes and Gobillon, 2015; Chauvin et al., 2017; Duranton and Puga, 2020). Horizontality produces sprawl and congestion (Duranton and Turner, 2011; Jedwab et al., 2022; Akbar et al., 2023). However, the skyscrapers of many developing countries constitute white elephant projects that are economically and environmentally inefficient (Gjerlow and Knutsen, 2019; Ianchovichina et al., 2022; Jedwab and Roberts, 2023). Finally, nations and cities of similar income levels can differ in their specialization in heights or areas. These specializations likely reflect differences in land-use regulations and institutions more broadly, as shown by studies on individual regions, countries, cities (Brueckner and Sridhar, 2012; Fox, 2014; Brueckner et al., 2017; Brueckner and Singh, 2020) or skyscrapers globally (Jedwab et al., 2022; Jedwab and Barr, 2023b,a). We instead consider the whole building distribution.

# **2. World Settlement Footprint 3D: From Version 1 to Version 2**

The first version of the World Settlement Footprint 3D (WSF3Dv1) dataset, released in 2017, provides information on the building fraction (BF), height (BH), and volume (BV) at 90 m spatial resolution (Esch et al., 2022). WSF3Dv1 was created based on a global coverage of 12 m digital elevation (TDX-DEM) and Synthetic Aperture Radar (SAR) data (TDX-AMP) collected by the TanDEM-X satellite mission in 2012-2013 (Zink et al., 2014), in combination with 10 m resolution multispectral Sentinel-2 (S2) satellite imagery. Although the analyses are performed at a gridding of 12 m, the final WSF3D products can only be made publicly available with a reduced resolution of 90 m due to German data security regulations (SatDSiG) related to the TanDEM-X mission.