Urban Function- and Residence-guided Zones and Urban Compactification: An Analysis of Population and Land Prices in Utsunomiya City

Abstract

Since the institutionalization of Location Normalization Plans in 2014, which were aimed at promoting the compactification of urban and residential functions against the backdrop of population decline in Japan, efforts have been made to guide these functions towards urban centers by establishing Urban Function-guided Zones and Residence-guided Zones. This study analyzes the effects of these zones, focusing on Utsunomiya City, Tochigi Prefecture, using a difference-in-differences design. Land prices and population density were used as outcome variables to clarify the impact of these zones. The analysis showed that land prices significantly increased before and after the designation of urban function-guided and residence-guided zones. Additionally, the density of the working-age population significantly increased before and after the designation of residence-guided zones. However, it was also revealed that land prices and the density of the working-age population had already been increasing prior to the policy intervention. The findings of this study indicate that the current compact city policy has achieved a certain degree of success.