The purpose of this paper is to analyze the effectiveness of border enforcement and internal enforcement policies under capital immobility and free capital mobility. Different from the previous studies where host firm is assumed to be risk-neutral, we introduce a framework in which host firm is allowed to exhibit different attitudes to risk and examine how the enforcement policies influence illegal migration. We show that the attitude toward risk of the host firm is important in determining the nature of equilibrium and many results with an assumption of risk neutrality continue to hold if the host firm exhibits a risk-averse attitude. We also show that under international capital mobility, the impacts of two enforcement policies on factor prices are different according to the factor intensity ranking between countries.

JEL Classification: F21, F22

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The purpose of this paper is to analyze an econometric model of urban and rural areas in China.
The current population migration is a serious policy issue in China. Since 1962 population migration has been severely restricted under the strict family register system, but it started to grow only after 1978 due to liberalization trend. Since 1990's foreign investment rushed to coastal-urban area, so the interregional difference with the retarded inland region has rapidly expanded. The rural area is very poor and, and excess workers are increasing. The rural population started to migrate to urban areas as restrictions on migrations were largely relaxed in the 1990's. But statistical information and quantitative studies about it are very scarce.
Here we pick up two different areas of this study, an urban area that is expanding and facing a vast inflow of population, and a rural area in a backward retarded region as the origin of population outflow, to analyze the interregional population migration. For that purpose, we estimated the functions of population migration based on 31 provinces in the 2 areas, and also constructed simple growth models for both areas.
We clarified the extent of population migration and assessed their its impacts on regional economic growth by simulation studies that combine these functions. This is a part of continuous research, and an extension of previous year's report.
JEL Classification: C30, C40, C50, J31, O15, O18, O47, R15

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This paper proposes two testable hypotheses to explain the persisting insufficiency of local fiscal resources in Korea. The first hypothesis is related to the revenue structure and the revenue raising efforts of local governments. Based on the fact that the local governments seldom exercise tax autonomy, we hypothesize that the elected local officials concentrate their efforts on obtaining intergovernmental transfers and refrain from exercising their taxing powers. The growth rate of ad hoc transfers obtained during an incumbents' term of office is positively correlated to her or his possibility for re-election. Since the local leaders can be rewarded by the electorates for bringing money from the higher levels of government to their districts, they tend to cry for more money with strong insistences of fiscal insufficiency. The second hypothesis is related to the size of the local governments. The average jurisdictional population is too small to enjoy scale economy in public service provision. By estimating the relationship between local expenditures and population, we found that there exists a scale economy with respect to population in the local public service provision. It is also shown that the average population of local jurisdictions is greatly smaller than the minimum efficient scale. These results imply that a reduction in overall local expenditures may be achieved by consolidating jurisdictions.

JEL Classification: H71, H77

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This paper investigates the production structure of local government enterprises in Japan. Government enterprises in Japan are now facing streams of deregulation and privatization, as are public utilities. It is useful to analyze the production and cost structures of government enterprises. Japanese local government enterprises own various kinds of businesses: water supply to residents and industries, mass transportation, subways, electricity, gas, drainage system, housing-lot supply, port maintenance and hospitals. Previous research has examined water supply, subway systems, bus transportation and hospital services, looking at each service, individually. However, prefectural government enterprises are usually administered by a single head manager, even though they belong to the different special accounts. We consider government enterprises in every prefecture not as an ensemble of many firms but as one unified firm administered by a single head manager.
We estimated a static Cobb-Douglas production function and a dynamic factor demand model, of forty prefectural governments in Japan from 2001 to 2005. A dynamic factor demand model is an application of dynamic programming model developed by Pindyck and Rotemberg[15](1983). The data is 5 years×40 prefectures panel structure.
The results are: 1) Japanese local government enterprises have only constant returns to scale. 2) The gross investment ratio is bigger than the gross depreciation ratio. 3) The result of the static model is slightly different from that of the dynamic model in estimates and elasticities.
JEL Classification: C33, C61, D21, D24

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Promoting renewable energy and rational energy use at the regional level is one of the most urgent subjects in Japan. In this paper, we demonstrate a local energy system modeling with MARKAL (Market Allocation) model. This model (the regional MARKAL model) is applicable to all types of government (Metropolitan, Prefectural, City, Town and Village) and assumes long-term energy demands and supply composition of each government from 1990 to 2050. The regional MARKAL model follows many of the technology parameters and preconditions of the Japanese MARKAL model (IO-Household and MARKAL model). Meanwhile, peculiarities of each government are defined by the region-specific parameters obtained from the local energy balance table. Finally we applied this model to Kuzumaki Town (Iwate Prefecture) and Hachinohe City (Aomori Prefecture) and evaluated the results such as energy consumption and CO₂ emissions. Since there is little experience in energy modeling at the regional level in Japan, this model can be used by local governments as an effective tool in their med- to long-term energy planning.
JEL Classification: Q41, Q56, R58

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How to make policy assessment is one of the biggest issues for local governments. Questionnaire surveying has been one of the main means to surface the needs from local residents for the local government or community and the survey results have been utilized to draw out concrete policies or measures in almost all local governments in Japan. However, an empirical research made by our research group has suggested that questions which ask satisfaction and importance level for residents' living environment items by means of ordinal scale tend to overestimate their needs due to external effects from local public facilities and services such as option value and prestige value and thus we proposed the introduction of quantification methods such as CVM(Contingent Valuation Method), AHP (Analytic Hierarchy Process) and Conjoint Analysis to surface local issues and make local community management effective.
In this study, we considered the policies in local governments to be a package of concrete measures for attaining goals in various policy fields and verified the applicability of conjoint analysis to policy assessment. Based on a questionnaire survey we conducted in Tatsuno, Hyogo Prefecture in 2006, we maintain that conjoint analysis is a viable method to grasp the preferences of residents for policies made by local governments. The results of conjoint analysis are presented and some tips for carrying out conjoint analysis through the questionnaire survey which we conducted.
As a further extension of this study, we plan to propose a viability of GIS based feedback system of questionnaire results to local residents. The goal of our research study is to verify the concept of “Informed Decision by Informed Citizens through GIS” and support local residents to participate all the steps of local community management process: Plan, Do and See or Check and Action.
JEL Classification: C35, R22, R58

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Water pricing policy attracts great public interest for efficient water use in the world. To discuss water pricing, policy makers highly need the real value of water price and the price elasticity in the field. However, few studies measured these indexes in Asia as well as Japan. This paper evaluates the demand-side value of irrigation water for rice production at Toban Irrigation area, Hyogo Prefecture in Japan. The choice experiment data from contingent questionnaire survey were used in order to overcome data limitation on price and quantities used in the fields. Then, the price of irrigation water and the price elasticity of demand were derived by using estimations of the random parameter multinomial logit (RPML) models. The results showed that (i) the water pricing value evaluated by farmers was not high enough to compensate for the full-cost price including construction costs and maintenance costs of irrigation facilities, (ii) the derived demand for irrigation water with regard to water price was inelastic, and (iii) the statistical performance of the RPML model was superior to the conventional multinomial logit model. These results demonstrate usefulness of choice experiment data with contingent scenario for discussing water pricing policy.
JEL Classification: Q25, Q28, Q51

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The purpose of this study is to analyze the performance of alliance through estimation of productivity growth. This study analyzes using the Transaction-Cost theory.
With research about alliance, most of them are case study. This has very important role in management research, but it is hard to derive universality from case study.
On the other hand, with research about estimation of productivity growth, there are many empirical researches. These researches are analyzed using production function. These are developed in accuracy of estimation, but not in content or way of alliance analysis. So, this study analyzed by using the model based on the model for productivity growth.
To begin with, this study organizes the contentions of resent empirical studies. And this study considers Transaction-Cost theory and set the hypothesis about relation between alliance and performance.
Then, this study grasps alliances in Japanese electric machinery industry quantitatively by using Nikkei-Telecon21 system, which is article retrieval system in Nikkei Inc, to analyze empirically. The object of analysis is electric machinery firms in ”Handbook of Industrial Financial Data 2005” edited by Development Bank of Japan. Analyze period is from 1993 to 2006, because the firm used here belongs to same industries in the period.
Finally, this paper estimates using the model based on Cobb-Douglas production function, which is used many precedence research. As the result of estimation, it was showed that (i) R&D alliance with the firm belong to same industry gives more positive influence to productivity grows, (ii) alliance in pair of firms and alliance with capital gives negative influence.
JEL Classification: L22, L64, M10, M21

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The national development plans and other regional plans in Japan had been formulated based on a traditional type of regional development model i.e. industrial development triggered by infrastructure development such as roads, ports etc. In this paper this model is identified as “the industrialization type regional development model”.
However, this model gradually lost its effectiveness since Japanese industries tended to locate their new factories abroad due to the drastic change of economic and industrial climate after the Plaza Accord and the decreasing population of young generation in the local area. Since then, regional development projects in this country had to be planned without having a common and effective development model.
The author who took part in formulation of “The Fourth Comprehensive National Development Plan 1987”, advocated a new type of regional development model i.e. “Exchange-Promotion-Oriented regional development model (EPO model)”. By this model, each region should re-establish its own identity, for revitalization the region, by promoting inter-regional exchange which would give good opportunities to experience different cultures, values and practices of the other regions.
This model is not so popular as “the introducing industries type regional development model” and the absence of the effective regional development model still continues.
The Interim Report of The National Land Sustainable Plan released in 2006, described the national land structure as the aggregate of the regions with own identities and values. Direct inter-exchanges of those regions with growing Asian regions will be the basic development concept. This can be said as the first case of applying EPO model as an effective model. This paper is to introduce the EPO model and to examine its effectiveness as regional development model.
The national development plans and other regional plans in Japan had been formulated based on a regional development model such as industrial development triggered by infrastructure development. However, this model gradually lost its effectiveness since Japanese industries tended to locate their new factories abroad due to the drastic change of economic and industrial climate after the Plaza Accord and the decreasing population of young generation in the local area. Since then, regional development projects in this country had to be planned without having a common and effective development model.
The author who took part in formulation of “The Fourth Comprehensive National Development Plan 1987”, advocated a new type of regional development model i.e. “Exchange-Promotion-Oriented regional development model (EPO model)”. The National Land Sustainable Plan released in 2008, also applying EPO model as an effective model.
In this paper, we intend to verify that the regional development (activation) model of our country changed with the Plaza Accord, and the EPO model has a possibility to become a leading model in network society.
JEL Classification: R58

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The present paper investigates where a monopoly postal company locates its offices using two regional models focusing on three factors. The first factor is a disutility for resident where the postal office does not exist to move between regions. Second factor is the costs to construct a branch office. The final factor is a quality. Based on these factors, we consider whether it is socially optimal if postal branch offices are eliminated. The results demonstrated that the monopoly postal company locates the postal branch office to maximize its own profits and minimize its costs. Whether this action is socially optimal or not depends on a marginal cost to quality, the distance between regions, and the costs of construction. In other words, these factors determine whether the monopoly postal office has strong or weak incentives to locate a branch office where it exists.
JEL Classification: R39, L12

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After the McSharry reforms in 1992, further emphasized in Agenda 2000, EU agricultural policy has shifted from a commodity specific price support system to one where income support is decoupled from production in order to avoid market distortions and environmental pollution. Little empirical evidence based on regional analysis exists about the consequences of this significant policy change. The purpose of this paper is to predict upcoming change of agriculture in the Less Favoured Areas (LFAs) caused by the reforms. First, a brief instruction for the analytical use of agricultural and geographic statistics in the U.K. is given, then six years of panel data from a Farm Business Survey (FBS) in Northern England are prepared with the aid of GIS. Second, Cobb-Douglass production functions are estimated through which probable combination of agricultural inputs and outputs is simulated with an assumption of farmer's profit maximization. The result shows significant shifts toward extensive farming based on sheep production rather than beef cattle rearing.

JEL Classification: Q12, Q18, R14

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As environmental problems worsen, the trafficking of people becomes an increasing concern. Few advancements have been made and unnecessary car use continues in the presence of commuter railways indicating people select transportation according to their destination and purpose. In this study we evaluated and compared the utilization of an expressway and a city railway to rate the transfer convenience, time requirements and negative environmental impacts. We also conducted a questionnaire of residents to clarify issues and incentives such as parking, railroads and buses important in the selection of mode of transportation. The results of this evaluation confirm the importance of intermodal frames and help to clarify the impacts of traffic on the behavior of people. Finally, the future of the traffic infrastructure, its direction and plan are considered as related to these results.
JEL Classification: R41, L91

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Although many projects have already been executed, it seems that most of them do not yet have a concrete concept of people's participation in the planning process of improving the waterside. We aim to construct a whole planning methodology for evaluation of the waterside. The study in this paper is just one of the processes of the overall planning methodology and takes into account people's participation through their impression of the waterside. This is because people have various kinds of feelings through their different uses of the waterside. In this study we focus on people's impression, which is captured qualitatively, instead of valuing quantitatively. Impression is described, for example, as ‘friendly, or not friendly', so impression is considered to be an integrated value which is composed of some elements.
The authors aim to clarify the environmental valuation of a waterside area through people's impressions. A social survey focusing on impressions and their components regarding Geo-, Eco-, and Socio-environments taking into account seasons or time, and place or space was first implemented. From the results of simple aggregation data, it was shown that there were differences of response to the Eco items for each season, to the Geo items and to the utilization of space in the Socio items for sub-areas. Secondly, it was clarified that the elements which constitute impression differ depending on season and sub-area by Cramer's coefficient of contingency. Further, it was shown that response and sensitivity to the GES impression differs depending on the season, even in the same sub-area. Finally, applying a factor analysis to the GES impression items (defined to be the integrated value), common factors have been derived that describe the characteristics of each sub-area.
Thus, it was shown that the people value the waterside, and the elements that constitute the valuation were demonstrated. Though derived common factors are the same among sub-areas, they are composed of different elements.
JEL Classification: Q51, R10, R53

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This paper examines the factors that determine the employment adjustments in Gifu Prefecture. The unemployment rate in the Tokai region (Gifu, Shizuoka, Aichi and Mie), is always low compared to the national average. Therefore, we analyzed the structure of employment and unemployment in Gifu Prefecture and examined the factors that cause employment adjustment. In addition, the characteristics of woman workers have an effect on the employment structure in Gifu Prefecture so we focus on the more liquid portion of the job market, woman workers in part time jobs.
JEL Classification: J64, R14, R23

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The diet and advancement of fishing villages are supported by the production and distribution of fishery products, so the control of quality and hygiene for these products is very important. In docking areas, infrastructures and countermeasures for quality and hygiene control such as traceability systems have been established by governments and regional HACCP. However, food poisoning incidents caused by fishery products and rumors of food poisioning have brought serious economic damages to the industry and consumers. Countermeasures are needed to reduce the losses.
In order to confront those conditions, the following four topics were investigated and the results are reported in this paper: (1) Analysis of economic damages caused by shellfish poisoning accidents and rumors—Case study of oysters in Akkeshi town, Hokkaido; (2) Development of scenarios for the economic damages from the accidents and the rumors; (3) Expectations of the direct economic impacts, and spread of economic impacts on the gross domestic products and analysis of damages and losses to both docking and consuming areas; (4) Consideration of the issues and ways to analyze, evaluate and control the risks in quality and hygiene of fishery products.
The results of this paper are as follows.
(1) By the shellfish poison accidents occurred in Akkeshi town in April, 2005, the economic impacts such as the direct expense for recall and disposal of oysters continued for one month, and the loss of crops and the decrease in shipping also continued for one month. Equally, by the rumor in December, 2006, the three month decrease in shipping oysters was reported.; (2) Three scenarios were supposed. The first scenario is based on the accident in April, 2005, and the second one is based on the rumor in December, 2006. The last one is the most serious scenario.; (3) The direct economic impacts caused by each scenario were estimated. The economic spreading impact and the gross domestic product were calculated by the I-O table. In the most serious scenario, the amount of the direct economic impact and economic spreading impact was 27 hundred million yen in Hokkaido and 14 hundred million yen in the whole of Japan except Hokkaido. The decrease of the gross domestic product was 12 hundred million yen in Hokkaido and 5 hundred million yen in the whole of Japan except Hokkaido.; (4) The economic spreading impacts in region and the outside of it were proved. And, in order to reduce the impacts toward both landing and consuming areas, important things are the strict control in the quality and hygiene of fishery products, the provision of the correct knowledge, and the risk management for the accidents.
JEL Classification: R15

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Generally speaking, economic activities are the origin of the environmental problem. Various kinds of natural resources are spent by economic activities, while a large quantity of waste is discharged during the course to the natural world. Hence, it is important to evaluate comprehensively the devoted natural resource and released waste within the economic activities and clarifies the relation between them so as to grasp the environmental problem precisely. Above all, there is big significance to draft and carry out effectively environment economic integration policy.
The previous study is excellent which shows that how much natural resource is consumed and how much waste article is drained by the kind of economic activities in the Toyama and Hokkaido individually. And from a point of view,the previous study is beneficial to improve the policy of area environment economy.
In addition, by the estimation of SEEA (System for Integrated Environmental and Economic Accounting), I mainly evaluate the quantities of the discharged waste articles such as NO_X and the decrease quantities of natural resources such as the forest. The evaluation method used is of maintenance cost method (technically, I use it to calculate the expense which I would spend as I take measures, and to evaluate environment load) And the evaluation rate achieved by this indirect method is called imputed environmental cost.
In this paper, the relation between economy and environment of Nagasaki is evaluated by SEEA method in basis of the previous study of Toyama and Hokkaido. There are five natural resources atmosphere, water, forest, land, underground resources and what discussed in the Hokkaido version [4] taken as the object of imputed environmental cost. Comparing to the previous study, the imputed environmental cost caused by the exchange of CO₂ is estimated in this paper. And in this basis, economic activities, industry structure of Nagasaki, and the relation between economy and environment are considered in this paper according to several numerical value indexes.
JEL Classification: R11, R13, R58

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The purpose of this study is to analyze spatial linkage among retail facilities by using the trip chaining data of shopping behavior on weekend in urban center of Fukuoka City surveyed by Fukuoka University Institute of Quantitative Behavioral Informatics for City and Space Economy. The results of analyses are summarized as follows.
First, single-stop shopping trips occupy only twenty percentage of the whole outdoor travel. Four retail facilities are visited on average in one outdoor travel. Second, it becomes clear that Zones 1, 2, 3, and 4 of the Tenjin underground center attract the most pedestrians. The second attractive facilities are department stores such as Mitsukoshi and Daimaru and major retail facilities like Solaria Plaza which are adjacent to the Tenjin underground center.
Third, the facilities which tend to be visited first in the outdoor travel are department stores such as Iwataya Main Building, Mitsukoshi, and Daimaru, isolated major retail facility like Ohpa, and Zones 3 and 4 of the Tenjin underground center which are considered as the gateways to urban center connected to railway stations. Conversely the facilities which tend to be visited last are the department stores and the isolated major retail facility.
Fourth, Zones 1, 2, 3, and 4 of the Tenjin underground center have the strongest attractive power and trickle-down effect. These Zones have strong trip chaining which amounts to an inflow of more than fifty shoppers each other.
Fifth, it is seen that a kind of hierarchy is formed by trip chaining among department stores and major retail facilities located in Tenjin area. Mitsukoshi and Daimaru-Elgara are positioned at the highest level in the hierarchy.
Sixth, it is noticed that the department stores such as Mitsukoshi and Iwataya Main Building and major retail facilities like Tenjin Core and Solaria Plaza gain large amount of expenditure from pedestrians, while the Tenjin underground center does not receive the amount of expenditure in proportion to the inflow of pedestrians.
It is summarized as a conclusion that the Tenjin underground center ranging from north to south in urban center of Fukuoka City attracts large amount of pedestrian flows and especially pedestrians generated from Zones 1 and 2 flow as shoppers into Mitsukoshi or Tenjin Core adjoined to west side or to east side respectively, and then diffuse to Solaria Plaza and Iwataya Main Building located at west side to Mitsukoshi.
JEL Classification: R12, R14, D12

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In this study, I examined the reasons for this rapid economic growth by way of identifying the industrial features unique to Inner Mongolia. Also, I examined issues related to unemployment being faced by local economies.
This examination has revealed that economic growth in Inner Mongolia is deeply related to the characteristics of the regional industrial structure. The basic industries of Inner Mongolia are the mining, electric power, iron and steel/metal-processing, and chemical industries, which are all strongly related to one another, offering the multiplier effect of economic growth to the region. Such characteristics of industrial structure are supposed to be principal factors for the achievement of the rapid economic growth of Inner Mongolia.
Not being labor-intensive, however, these basic industries can hardly be expected to absorb labor force. With the advance of regional differentiation, the development of light industry with high labor absorption and of forward-related industry, that is, tertiary industry, is limited, blocking labor absorption. In this industrial context, rationalization of the employment structure of primary industry has been promoted, and labor force eliminated from the agriculture and livestock industries has served to raise the unemployment rate.
To resolve unemployment issues, therefore, it is important to develop light industry that can meet regional needs. This would promote the development of tertiary industry and, consequently, employment in the region. The mining, agriculture and livestock industries are foundations for industrial linkage in Inner Mongolia, where no other industries would develop in their absence. It is, therefore, thought that the sustainable development of Inner Mongolia depends on the successful achievement of rational development and environmental protection (regarding cultivated land and grassland).
JEL Classification: L16, O11, O18, R11

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