The Evaluation from the Efficiency of the Public Capital in Three Major Metropolitan Areas

Abstract

  We investigate the economic effect of public capital in the three major metropolitan areas (Tokyo, Kansai（including Osaka）, Nagoya) in 1995 and 2005 based on Roback (1982). By using cross-section data in the municipal level of three major metropolitan areas, we can evaluate the change in the municipal allocation of public capital from 1995 to 2005.

  We show that national road, prefectural road, and park have the welfare effect and the productivity effect in all three major metropolitan areas. And we indicate that the allocation of public capital in Tokyo area is efficient. On the other hand, especially in Kansai area, the municipal allocation of public capital is inefficient.