Abstract
Due to an economic background that most remote islands are less developed in terms of capital accumulation, the government of Japan continues to allocate financial assistance to those islands. This paper is an exploration of the influence of publicly provided social capital on the regional economy of remote islands. Concretely, we measured the economic impact of the accumulation of regional public-capital by an empirical analysis. Since there are several regions consisting of many islands with different cultural, historical and economic aspects, we focused our geographic attention on the Okinawa islands located in southern Japan. We begin with a discussion of the constructing data set concerned with publicly provided capital accumulation in Chapter 2. The range of the research is limited to Okinawa because there are several regions consisting of many islands that have different cultural, historical and economic aspects. Subsequently, a set of empirical analyses is described in Chapter 3 with an estimation of the conventional production functions. As a result of the analyses with estimations of conventional production functions, the impacts of exogenously provided capitals were observed to play negative roles on the private economy. Second, the degree of the negative impact was higher in agriculture than tourism. Third, transport-related regional capital, especially the construction of roads, showed low effects (negative impact) on the regional economy. Finally, a spill-over effect of the central island (Naha area) on the other islands was high.JEL Classification: H410, R110
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