In 1950, 53 percent of Japan's population lived in urban regions; by 2014, 93 percent did. (In the U.S., by contrast, 81 percent of the population lives in urban regions.) It is mostly young people who move to the cities, and that means that as Japan's population ages, the cities and towns outside the city-state are left to fade away. Japan's Ministry of Internal Affairs says that now, around 15,000 of Japan's 65,000 or so communities have more than half of their population over the age of 65.One can't help but notice how Japan's internal migration has played out, given its low immigration levels in relation to other countries. Even though I don't care for the protectionist takeaway which some applaud, the lack of immigrants to Japan has apparently meant somewhat lower housing costs in its dynamic regions.
Still, the fact at least 15,000 communities in Japan are questioning their ability to survive, is not to be glossed over lightly. Instead of adding further protectionism to an already out of balance general equilibrium, many nations will do better to continue embracing open economies. I believe that by reducing services dependence on prosperous regions and existing revenue sources, defined equilibrium options could reverse the decline of rural regions and other areas.
City residents in nations such as the U.S. are reluctant to make additional room for more residents - given limited services and infrastructure - for either internal (domestic) or external migration. Are there ways to make today's less dynamic communities, more desirable to new residents? This is not just an important issue for long term economic growth, but also in the more immediate sense of social isolation. Alana Semuels continues:
The problem is not necessarily that Japan will run out of money to care for its growing elderly population. In 2000, the country implemented a mandatory long term care insurance program that is paid into by everyone over 40. Elderly people, even in rural areas, can receive services like home help and adult day care for moderate fees. But someone needs to be around to provide these services.Some community loss is likely inevitable for Japan, and elsewhere. Already, older citizens in Japan are planning to destroy homes which they believe their children will never return to live in. Likewise, in the U.S., more homes are likely to be demolished in coming decades. Many older homes - in order to remain livable - require refurbishment beyond the income capacity of potential residents who might otherwise find such residences to their liking.
Nevertheless, the ongoing loss of towns outside of more productive regions, hardly means that new forms of productive agglomeration aren't possible. As populations continue to sort out what has become a rapidly evolving economic destiny, flexible building components and infrastructure could contribute to this process, to make possible a fuller range of lifestyle options, during the demographic shifts when they are most needed.
Communities in the near future, will increasingly need to focus on ways to combine intellectual challenges with what are considered more mundane, yet necessary activities. Understandably, many are beginning to rebel at the skills (hence class) divisions now expected by today's service sectors, which tend to be more arbitrary than the constantly changing divisions of labour in tradable sectors. In order for defined equilibrium settings to prosper, they will need to generate lifestyle amenities (particularly experiential product) which is normally more closely associated with the intellectual challenges of fully compensated work. Via the sharing of personal aspirations in the workplace, individuals who often find themselves limited to low skill options, would finally get the chance to pursue more challenging forms of work.
The present impulse to shut down countless areas and move everyone into thriving regions, also misses some important aspects of what is involved in productive agglomeration. Economic dynamism has been held back, because knowledge as currently utilized, faces organizational limits. Instead of attempting to force access to already limited infrastructure and services, more infrastructure and services needs to be generated on terms which can adapt to multiple income levels.
Economic opportunity need not be zero sum. One reason our political realities contain such an unfortunate mindset, is that too many limits were placed on economic participation, without sufficient consideration of the individuals who are being consigned to the sidelines.
In all likelihood, there are knowledge providers in prosperous regions who - given the chance to consider what's at at stake - would want to help ensure that forgotten areas aren't left needlessly left behind. Even though many of today's knowledge providers are largely equilibrium dependent, they could help initiate a new reality in which it is no longer necessary for intellectual challenges to remain general equilibrium dependent. Many of our forgotten areas could benefit from the seeds of a new harvest, for a more broadly shared future of economic participation.