An Empirical Study on the Economies of Urban Agglomeration under the Service Economy

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The aim of this study is to measure the economies of urban agglomeration from point of local public services based on resent Japanese data, and to investigate the concentration of population and economic power to big cities in the era of service economies.I already showed the existence of economies of urban agglomeration from point of local public finance through my book "Optimum City Size and Merger of Municipalities" (Toyokeizaishinposha, 1999). The theme of this book is developed more in this study, especially from point of public services, administrative reform, degree of administrative restructure, public sector evaluation, outsourcing of public services, and market testing. Through this study we can verify the existence of economies of urban agglomeration from point of local public services, that is, the degree of public services increases rapidly up to some size (about 300-500 thousand population in almost cases) of municipalities, and increases gradually over the size just mentioned, as the size of municipalities measured by the number of population increases. Then we can expect the expansion of city size improves the public services and the efficiency of public administration.