Abstract
The aim of the paper is to verify the policy importance of activation of urban cores in terms of urban economics. Specifically, using a model of economy with service quality (Kobayashi et al., 1990) and UEA (Urban Employment Area) based data, we have test the relationship between urban densities and activity of twelve service industries. The results are as follows: We can see significantly positive relationship only for technical services (including teaching services), restaurants and bars. We guess the reason is that these industries are knowledge-intensive and have various externality effects, including firm-to-firm externalities and consumer-to-firm externalities. To activate urban cores and urban economy, we have to consider these characteristics of service industries.
