Interregional Interdependence and Regional Economic Growth: An Interregional Input-Output Analysis of the Kyushu Region

The main objective of this paper is to examine the effects of the changes in economic conditions and government policies on the output growth of the Kyushu region between 1965 and 1990. This study uses the extended growth-factor decomposition method based on a three-region Japanese interregional input-output system consisting of Kyushu, Kanto, and the rest of Japan. The growth pattern of Kyushu changed noticeably over the period. The primary drivers of growth changed from the expansion of final demand within Kyushu to direct and indirect effects from outside Kyushu. This unambiguously indicates that Kyushu has facilitated interregional and international interdependence. The emergence of the processing and assembling sector, together with the construction of new networks of trunk railway lines, expressways, and communications, promoted closer interregional industrial linkages between Kyushu, Kanto, and the rest of Japan. In addition, the offshore transfer of production from Kyushu to Southeast Asia after the Plaza Accord Agreement strengthened Kyushu's international industrial linkages.     

Dynamic stability of an open city with many household classes

This paper analyzes the dynamic stability property of an “open” city with many classes of households. We specify a dynamic adjustment process of household movement into and out of the city in such a way that the number of households in each class increases or decreases over time, according as the utility level households can obtain in the city is higher or lower than a certain utility level attainable elsewhere. Then we prove that a long-run equilibrium is locally stable for positive speeds of adjustment under reasonable assumptions. Some comparative static properties are also explored.     

The golden rule of urban transportation investment

The purpose of this paper is to find an optimal taxation rule for transportation investment in an ever growing urban economy. First we dynamize a standard circular-city model with identical residents by introducing population growth and transportation improvements over time. Assuming that utility functions are of a constant-elasticity form and transportation investment is financed by an income tax, we prove the existence, uniqueness and stability of a balanced growth equilibrium for each given tax rate. Then, an optimal tax rate is determined so as to maximize the balanced growth equilibrium level of utility for every resident in the city. It is also shown that our simple rule remains valid in the case of two income classes.     

A choice of auction format in seller cheating: a signaling game analysis

In this paper, we examine which auction format, first-price or second-price, a seller will choose when he can profitably cheat in a second price auction by observing all bids by possible buyers and submitting a shill bid as pretending to be a buyer. We model this choice of auction format in seller cheating as a signaling game in which the buyers may regard the selection of a second price auction by the seller as a signal that he is a shill bidder. By introducing trembling-hand perfectness as a refinement of signaling equilibrium, we find two possible strictly perfect signaling equilibria. One is a separating equilibrium in which a noncheating honest seller selects a first price auction and a cheating seller does a second price auction. In another pooling equilibrium, however, both cheating and non-cheating sellers select a second price auction. The conclusion that a seller chooses a second price auction even if he cannot cheat is in contrast to the previous literature, which focused on the case of independent values. We thank an anonymous referee for useful comments that have improved the paper. This research was partially supported by the Ministry of Education, Science, Sports and Culture, Grant-in-Aid for Scientific Research (B) 15310023 and (C) 18530139.     

Why Has the Fraction of Nonstandard Workers Increased? A Case Study of Japan

This paper explains the secular increase of nonstandard workers in Japan, whose share of employment increased from 17 to 34% between 1986 and 2008. Changes in labor force and industrial compositions account for one quarter of the increase of nonstandard workers. Product‐demand fluctuation and the introduction of information and communication technologies increased firms' usage of nonstandard workers, but its quantitative effects are limited. The increase of nonstandard workers was concentrated among new entrants to the labor market, male workers of younger cohorts, and female workers of all cohorts, suggesting that the declining importance of the long‐term employment relationship is a major cause for the increase of nonstandard workers.     

An International Comparison of Leontief Input-Output Coefficients and its Application to Structural Growth Patterns

Empirical sectoral analyses of a standard development pattern have focused upon changes in the value added, disregarding the structural changes in intermediate input. In a more comprehensive approach to the production function, the present paper analyses both sectoral intermediate inputs and the value added by using 45 input-output tables to discover a standard pattern of the changes in the input-output coefficients as an economy develops. The major findings are first a U-shape pattern of the average value added ratio and, conversely, an inverse U-shape pattern of the average intermediate input ratio. Secondly, as compared with principal input coefficients that are broadly stable, supplementary input coefficients exhibit the non-linear trends of an inverse U shape contributed by a rising trend in agriculture in the early stages, and a growing energy cost in most sectors, although this is partly offset by mild U shapes of transport and distribution costs. A similar inverse U-shape pattern is implied for the Leontief multiplier.