Transformation Processes of National Land Systems and Reconstruction Policy from a Spatial Economics Perspective

For a systematic understanding of the concentration of economic activities in large cities and industrial areas, we first introduce the basic concept of spatial economics. The spatial structure of the economy stems from self-organization that occurs from the balance between countering agglomeration forces and dispersion forces within historical path dependence. Decreased transportation costs reveal the endogenously generated agglomeration and dispersion forces hidden behind the agglomeration and dispersion forces based on natural characteristics. Remarkable improvement of transportation access among cities might cause the production of highly differentiated goods and services absorbed from small cities to large cities (straw effect), or small cities to disappear under the influence of larger cities’ shadows (shadow effect). In this view, we understand that Japan’s national land system increased concentration through self-reinforcing agglomeration 8 economies in the core area, mirrored by a negative feedback of population decrease and weakening agglomeration forces in the periphery (rural) areas. The population in many rural prefectures in the post-war era had already reached a peak in the 1950s, long before Japan’s population peaked in 2008. As Japan has entered a “knowledge-creating society” as the post-industrialization society, agglomeration to the Tokyo metropolitan area has become more intense, attracting highly skilled and higher income people. Concentration of political powers and outstanding diversity in public infrastructure for science, transportation, culture, and amenity further strengthened the dominant position of the Tokyo metropolitan area. It should not be dismissed, however, that the Tokyo monopolar concentration has already shown negative effects. A lower childbirth rate in urban living and working conditions is an example. The exodus of young people from unique local areas and concentration in the Tokyo metropolitan area results in the assimilation of ways of thinking and a loss of diversity in people. The latter is detrimental in the knowledge-creating society. Furthermore, excessive concentration of economic and political powers increases the systemic risk, as evidenced during the Tokyo-centered COVID-19 pandemic.