A Dynamic Rural-Urban-Natural Environment Interactive Spatial Model of Palangkaraya City in Indonesia

Permana and Miyata (2009) showed a partial equilibrium urban economic model to explain the existence of illegal settlements in flood prone areas in Palangkaraya City in Central Kalimantan Province, introducing the expected damage rate on household asset. Applying this new idea, one can derive the conclusion where the bid rents by low income households get higher than those by high income households in flood prone areas. This is the contrary conclusion being highlighted as compared with that in the traditional urban economics. Following this paper, Permana and Miyata (2009) extended the partial equilibrium model into a general equilibrium model. And then Permana and Miyata (2009) developed a two dimensional city model applying Miyata's achievement (2009). However the study region, Palangkaraya City and its surrounding area, shows a complicated interaction between natural environment and human activities. Therefore this article aims at developing a rural and urban economic model with natural environment considerably extending our previous literature

Evaluating the economic impacts of the technological innovation in the motor vehicle industry: The input-output approach

In this paper, the economic impacts of technological innovation, such as electric and hybrid vehicles, in the automobile industry in Japan are examined. The automobile industry has to develop environmentally friendly vehicles in the face of the global warming issue and the exhaustion problem of petroleum. The conventional automobiles with gasoline and diesel oil don't meet the demands of present age. The new generation automobiles will become popular for coming several decades. The industrial structure will be affected by the appearance of new generation automobile. Especially, since the Japanese economy strongly depends on the automobile industry, the appearance of technological innovation in the automobile industry has an influence on the other industries and the industrial regions where the automobile firms are concentrated. In this study, we explore the economic impacts of shifting the production system in the automobile industry from the conventional automobile technology to an electric and hybrid vehicle technology using the national and multiregional input-output models

Economic Impacts of a New Road Network in San-En Region, Japan: A Spatial Computable General Equilibrium Model

In this paper, we aim to evaluate impacts of a new road network on the regional economy in San-en, Japan. San-en area is a boundary region between Aichi and Shizuoka Prefectures where the industrial sector is concentrated. The regional economy in San-en strongly depends on the regional transportation networks. Recently, a new road construction is planned in the region. The efficiency of road investment is expected for the regional economy. We construct a spatial computable general equilibrium model to evaluate the border economy. The spatial economic impacts of a new road construction are analyzed by the numerical simulation under several scenarios.

Theoretical Analysis of Urban Land Use Change by Information Provision for Nankai Trough Huge Earthquake in Japan

This study employs an analytic urban economics approach, assuming that Toyohashi City takes a linear shape and there are two districts where the vulnerabilities to the earthquake in the two districts are different. That is, Toyohashi City is divided into two districts, one is safe for the earthquake while another one is risky for the earthquake. And then this study theoretically considers how the land rent and the land use pattern of these two districts will change by provision of disaster risk information and by a change in reliability of information for households. As a result, the following conclusions are obtained. (1) In a case where household subjective reliability of disaster risk information is not considered, households and land rents are uniformly distributed if disaster risk information is not provided, and the two districts receive the same damage when the earthquake occurs. However, if disaster risk information is provided, the land rent shows a decrease in the risky district as the frequency of earthquakes increases. On the other hand, the land rent increases in the district with the low damage risk. As a result, the land with the lower rent than the agricultural land rent is not used for residence, thus the residential area shrinks in the risky district while it expands in the safe district. From these results, provision of disaster risk information leads households in the risky district to the safe place, resulting in a decrease in the population and properties in the risky district that are expected to receive significant damage when the earthquake occurs. Moreover, since a decrease in the household utility due to an increase in the occurrence probability of the earthquake gets smaller than that in the case of symmetric vulnerability for the earthquake, it can be concluded that the effect of information provision becomes larger in the risky district

Environmental and Economic Impact of Carbon Credit in Makassar City in Indonesia

Economic measures are advanced to environmental problems in EU nations. The economic approach imposes a constant economic load on activities negatively affecting the environment, and it is also a technique for giving a constant profit for activities conserving the environment. The whole society is expected to be environmental-friendly state by this incentive. Moreover, this method has the advantage for inventing new technologies and efficient production processes. The direct regulation is pointed out as an environmental conservation measure. However dependence on the regulatory control has the anxiety to decline the economic vitality of firms. Therefore, the economic approach that does not decrease inventiveness and the autonomy of each firm becomes important. Carbon credit can be taken as one of the economic measures for controlling global warming. The upper limits of CO2 emissions are assigned to each firm or country, and the carbon credit is defined as a credit of the volume of CO2 emissions generated by economic activities. The mechanism in which the total CO2 emission is controlled by buying and selling the carbon credit is called emission right trading. The present study focusses on the carbon credit. Although researches on environmental and economic impact by carbon credit at a country level have already been conducted, studies on such a topic in developing countries emitting large CO2 and/or a city level have hardly been found. Hence, the present study analyzes the environmental and economic impact of introduction of carbon credit in Makassar City, which is a main city in east Indonesia, by employing a computable general equilibrium (CGE) model. The reason selecting Indonesia as a study country is that CO2 emissions in Indonesia considering the swiddens and the peaty land are ranked at the third place in the world. The reason selecting Makassar City as a study region is that there is an enough forest in surroundings of Makassar City and a big amount of the CO2 forest absorption can be expected for issuing the carbon credit. Moreover, it is another reason that there is an input-output table in Makassar City, and data that is necessary to construct a computable general equilibrium model is available. In this paper, Makassar City is assumed to issue a carbon credit and sell it to other regions. Numerical simulations are implemented to analyze the environmental and economic impact of the carbon credit. The simulation results show a decrease in CO2 emissions and an increase in household utility in Makassar City by selling the carbon credit to other regions

Economic Impact of CO2 Emissions and Carbon Tax in Electric Vehicle Society in Toyohashi City in Japan

In this paper, we explore the economic impact of promotion and realization of an electric vehicle society (EVS) in Toyohashi City in Japan. More concretely, this paper emphasizes a computable general equilibrium (CGE) modeling approach to evaluate the following issues: economic impacts of subsidies for promotion of an EVS, economic impacts of carbon tax for reducing CO2, industrial structure change towards an EVS, and modal shift occurring towards an EVS. Our simulation results demonstrate that after applying 5 ~ 25% up subsidies to five industries including electric vehicle (EV) manufacturing, EV transport, solar power, cogeneration and other transport, the total industrial output and city GDP increase. A large growth rate is found in industries where subsidies are introduced, but non-ferrous metal industry also grows without subsidies due a repercussion effect. Moreover, it is interesting that decreasing proportions are found in oil and coal product, mining, heat supply and gasoline vehicle (GV) transport industries. However the total CO2 emission in Toyohashi City is increased being interpreted as a rebound effect. All the commodity prices decrease since subsidies are given to some industries. Hence Toyohashi Cityfs economy shows a direction where the demand for conventional vehicles and energy use are decreased, conversely, the demand for EVs and renewable energy are increased illustrating a different life style from the current one. Regarding CO2 emissions, we introduced a carbon tax of 1,000 yen/t-CO2 for industries except the five industries mentioned above. As a result the total CO2 emission is decreased and the equivalent variation shows a positive value as compared with the base case. Thus introducing 5 ~ 25% subsidies and the carbon tax can really represent a realistic alternative society to EVS in Toyohashi City

Economic and Environmental Impacts of Electric Vehicle Society in Toyohashi City in Japan - A CGE Modeling Approach -

In this paper we explore economic and environmental impacts of promotion and realization of an electric vehicle society (EVS). More concretely, this paper emphasizes a CGE-modelling approach to evaluate the following issues: entire economic impacts of subsidies for promotion of an EVS, the possibility of carbon dioxide (CO2) emissions and prices reduction, a change of industrial structure towards an EVS, and a modal shift towards an EVS. Our simulation results demonstrate that after applying 20% subsidies to five industries including electric vehicles (EVs) manufacturing, EV transport, solar power generation, cogeneration and other transport, the total industrial output and municipal GDP increase. A large growth rates are found in industries where subsidies are introduced except non-ferrous metal industry. However, it is motivating that decreasing proportions are found in oil, coal product, mining, heat supply and gasoline vehicles (GVs) transport industries. Moreover all the commodity prices decrease since subsidies are given to some industries. Hence Toyohashi Cityfs economy shows a direction where the demand for conventional vehicles and energy use are decreased, conversely, the demand for EVs and renewable energy are increased that displays different lifestyles from the current one. For all these reasons, it is our conclusion that EVS can really represent a realistic and alternative society both in terms of economic development and CO2 emissions reduction. In this study therefore it is clear that modal shift will occur to EVS, and thus we suggest for promotion of a new industrial structure to introduce an EVS in Toyohashi City in Japan. The proposed model can even be applied to the other cities in Japan and other countries in the world which are similar to this area

An Intertemporal Urban Economic Model with Natural Environment

We are surely faced with the unavoidable problem as an element of important restrictions of development of human beings. It must be required to be solved immediately. It also brought the economic concerns to academic fields long ago. The positive and negative impacts of environmental and ecological changes are concerned the shift to a circulated type society from the conventional society. It is required by the end of today when the environmental problem in a global scale is aggravating. The view of the compact city of energy and resources saving is observed in recent years. The research on the balance of environmental load and urban growth needs to attract attention. In this paper, we consider a problem concerning the relationship between the spatial efficiency and the sustainability in an urban system. An urban model with natural environment is constructed to examine the possibility of such future urban forms. The idea of compact city offers us an important concept for sustainability. Our approach is based on the urban economic framework. Urban models, which have been developed since the 1970s, are classified into two categories, static and dynamic models. We adopt the framework of the dynamic urban model. In our study, the dynamic urban economic model with natural environment is built. The optimal control is applied into our numerical computation and the simulation analysis of the model is performed under several scenarios

Economic Analysis of Illegal Settlements in Flood Prone Areas in Palangkaraya City in Indonesia: A General Equilibrium Approach

Since initially steaming from von Thünen's work (1826), bid-rent approach has been rigorously applied to analyze land use configuration. Alonso (1964), Muth (1969), Beckman (1973), Solow (1973), and Fujita (1989) are among the scientists who greatly contributed to forward von Thünen's theory into complexities in urban context.. Particularly Fujita (1989) has showed solution of a utility optimizing problem to define the bid-rent function which gives the maximum ability of households to pay land under a fixed utility and at distance from the Central Business District (CBD). The bid rent concept provides richer analysis of the locational choice of households in the city. Our study considered a small-medium city in a developing country located in tropics where a massive deforestation and river flood significantly jeopardize some areas in the city. It is Palangkaraya city in Central Kalimantan province, Indonesia. There are two types of land classified in the city. One is called normal land where the river flood is not able to inundate while another one is namely flood prone areas. The flood prone areas are occupied by settlements which are mostly illegal. Here illegal settlement refers to those kinds of settlements which were built on parcels with no legal clearance on land ownership including those which were constructed without building permission (Kapoor &Blanc, 2008). This paper aims to analyze a configuration of the residential land use pattern in Palangkaraya city in Indonesia applying bid-rent approach which incorporated the expected flood damage rate (EFDR) on household assets. The EFDR is employed to predict the damage by the river flood since flood occurrences are stochastic and such appropriate data on flood occurrences is not available. Previously Permana and Miyata (2009) showed a partial equilib-rium urban economic model, introducing the EFDR. However we realize that the partial equilibrium model slightly lack of reality since income is assumed to be exogenously given. Hence we develop a general equilibrium model taking into account firms in the Central Business District (CBD), and by incorporating the expected damage rate on household's asset, the new bid rent function and bid max lot size function are obtained. Applying the general equilibrium modeling approach, one can derive the conclusion that the bid rents by low income households get higher than those by high income households in flood prone areas. This is the contrary conclusion being highlighted as compared with that in the traditional urban economics