Agglomeration Economies and a Test for Optimal City Sizes in Japan

Abstract

We estimate aggregate production functions for metrpolitan areas in Japan to derive the magnitudes of agglomeration economies. Using the estimates of agglomeration economies, we test if Japanese cities, in particular, Tokyo, are too large.J. Japan. Int. Econ.,December 1996,10(4), pp. 379–398. Faculty of Economics, University of Tokyo, 7-3-1 Hongo, Bunkyo-ku, Tokyo 113, Japan; Socio-Economic Research Center, Central Research Institute of Electric Power Industry, 1-6-1 Ohtemachi, Chiyoda-ku, Tokyo 100, Japan; and Institute of Socio-Economic Planning, University of Tsukuba, 1-1-1 Tennodai, Tsukuba, Ibaraki 305, Japan.