Property Tax Reform and Land Use: Evidence from Japan

Tomomi Miyazaki and Motohiro Sato
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Motohiro Sato: Graduate School of Economics, Hitotsubashi University

No 181905, Working Papers from University of California-Irvine, Department of Economics

Abstract: It is often said that farmland conservation in urban areas (i.e., cities and inner suburbs) is not desirable because it hinders converting farmland into residential areas, thereby deterring urbanization. If the preferential treatment of property taxes on farmland is rectified, these problems can be solved. In this paper, we study two property tax preferential treatment reforms that took place in Japan during the 1990s. We examine the effects of these reforms by theoretical and empirical investigation. The econometric results are consistent with our theoretic model’s main predictions; the proportion of farmland in the major cities in the three metropolitan areas (Tokyo, Chubu, and Kansai) decreased following the reforms. However, since landlords did not replace all the farmland with housing lots, the problem of obstructed urbanization remains to be solved.

Keywords: Property tax; Land use in urban area; preferential treatment on farmland; urbanization (search for similar items in EconPapers)
JEL-codes: H22 H71 R52 R58 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2019-04
New Economics Papers: this item is included in nep-acc, nep-pbe, nep-pub and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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