Regional Allocation of Production Factors and Economic Development in Japan : A Regional Macro-CGE Analysis

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  • 高度経済成長期における生産要素の地域配分と地域経済への影響 : 1部門地域リンクCGEモデルによる計量分析
  • コウド ケイザイ セイチョウキ ニ オケル セイサン ヨウソ ノ チイキ ハイブン ト チイキ ケイザイ エ ノ エイキョウ 1 ブモン チイキ リンク CGE モデル ニ ヨル ケイリョウ ブンセキ

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Abstract

This study examines the effects of public investment on the regional economies of the high economic growth period in postwar Japan. The previous study of Kataoka (2003) , using single equation model based on prefectural production functions, showed that public investment was used as a policy tool for adjusting income distribution and accelerating economic growth; however, it obtained several limitations to be improved. The author applies a one-sector regional macro-CGE (Computable General Equilibrium) model, which links 46 prefectural models of the aggregate one-sector GDP level and was originally developed by Ezaki et al. (2002), to provide the following two improvements from the previous study. The first is that a substitute relation between prefectural private and public investment allocation is assumed, rather than an independent relation. The second is that active interregional trades of goods and services, which determine regional income inequalities, are assumed. The new technique, entropy maximizing model, is also applied in this study to estimate inter-prefectural trade matrix. This simulation results confirm the study of Kataoka (2003) and indicates that in the case of income-elastic labor mobility, an efficiency-oriented allocation policy leads to larger aggregate gross domestic product by promoting both growth and equity simultaneously.

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