Public Policy and Politics in Times of Population Decline
Part 7: Impact on Infrastructure Renewal
Consulting Fellow, RIETI
In the years ahead as the population declines and regional areas depopulate, it is crucial that selection standards for maintaining and upgrading accumulated capital including public infrastructure will be based on a long-term perspective.
Japan began the full-fledged improvement of its public infrastructure during the 1950s and 1960s. Since around 2010 when such public infrastructure passed the 50-year service life, its deterioration has become visible rapidly. In 2012, the Chuo Expressway's Sasago Tunnel caved in. The United States also faced deterioration of its public infrastructure in the 1980s when accidents including bridge collapses occurred.
In maintaining and upgrading public infrastructure, it is needless to say how important it is to select locations spatially using future estimates of population distribution as well as geographic information systems (GIS) in relation to population decline. Moreover, it is necessary to consider investment from a time perspective.
Generally speaking, the optimum supply of public infrastructure differs depending on the rate of population change. In order to simplify the discussion, let us assume that the optimum infrastructure supply per population unit is one and that a population increases from 100 to 160 over a period of 50 years, and another case where the population decreases from 100 to 40 over a period of 50 years.
In such a case, even if an infrastructure of 100 is supplied when the population is 100, a 160 infrastructure will be needed when the population increases to 160, so a supply of 100 is not wasted. However, when there is a decline in the population, an infrastructure of 40 would only be needed if the population is 40, so an infrastructure supply of 60 would be wasted. The lifecycle cost of infrastructure should also be considered as a time perspective.
For Japan to maintain its competitiveness, it is efficient to curb investment for maintaining or upgrading public infrastructure that is unlikely to be used over the medium- and long-term and to enhance the infrastructure in urban areas where it is more likely to be used. However, such an allocation is not easy to reconcile politically. In order to foster such agreement, a public infrastructure selection standard based on objective data should be soon created.
* Translated by RIETI.
November 4, 2015 Nihon Keizai Shimbun
January 28, 2016
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