An Empirical Study of the Impact of Area Management Activity on Property Prices in Japan

Over the past few years, Japan has witnessed a significant decline in local economies and widespread depression across many industries. A set of measures known as Area Management Activity (AMA) were introduced to revitalize towns and cities based on the combined efforts of the private and government sectors. This study assesses the impact of AMA on property prices through several empirical tests, such as principle component analysis. We use data sets on 1,300 areas including 826 municipalities, in conjunction with the Ministry of Land, Infrastructure, Transport, and Tourism. The empirical evidence clearly indicates a significant relationship between AMA and land prices.