Does Compact City Policy Benefit Incumbent Retailers? Evidence from Toyama City

Author Name IWATA Shinichiro (University of Toyama) / KONDO Keisuke (Fellow, RIETI)
Creation Date/NO. December 2019 19-J-069
Research Project An Empirical Study on Compact City: Evaluating place-based policies in Japan
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First draft: December 2019
Revised: October 2021


This study evaluates the compact city policy of Toyama city, Japan, focusing on retail revitalization. To address future population aging and population decline, the "Toyama compact city model" aims at residential concentration in the city center and multiple areas in suburbs, with a public transport system that connects them. On the basis of the economics of density, retail revitalization is also expected from the residential and economic concentration in areas targeted by Act on Vitalization in City Center and Residential Promotion for Surrounding Public Transportation. Using matching estimation and difference-in-differences estimation with the panel data of incumbent retailers located in the targeted areas, which correspond to a treatment group, this study finds that the current framework of the "Toyama compact city model" does not produce the expected results for retail revitalization.

The English version of this paper is 21-E-085.