During the period of rapid economic growth, young people in local regions responded to the need for labour in the metropolitan cities, leading to a concentration of the population in urban areas. Young workers married, raised a family in the large cities, helped consumer durables to penetrate the market, which in turn led the changes in city-dweller's lifestyles. From the mid-1970s on, the expansion of government-led public projects helped to raise the income level in the local regions and the urban lifestyle spread to the local areas. It is important to note that employment was supported by construction work to a considerable extent.

Today, local regions lead metropolitan cities in terms of population decrease and aging. With the continual reduction in public work, it is essential to foster industries having growth potential and that are self-sustainable in local areas. In the large cities, on the other hand, many workers who moved from local regions are nearing retirement age. Most of these people live in the suburban dormitory towns and commute to city centers. They have close relationships with their colleagues at work but there is a concern that they have a limited connection with their local community.

## (Period of rapid economic growth:

## population concentrated in metropolitan region, consumption stimulated by urban lifestyle)

During the period between the postwar era and rapid economic growth, the population grew significantly. Looking at the increase in population by region, the population increase concentrated in the three major metropolitan regions. The major factor in this concentration is the migration of many people, who were born in local regions, to large cities to attend higher education or find work. This group of people, after having come to metropolitan areas, learned new skills and production techniques in the industrial sector, and supported Japan's rapid economic growth, particularly in terms of production. At the same time, the younger generation who flowed into the large cities built a foundation consisting of new households, which supported the growth of consumption during this period.

The penetration rate of consumer durables into households rose dramatically during the period of rapid economic growth. However, in the 1960s there were gaps in the rate of increase between regions. The rise in the consumption of durable goods was mainly led by the new households, which emerged in the large cities. In short, urban lifestyles led consumption (Figure 23).

## (After mid 1970s: regional income gap contracted, dependency on public investment grew)

In the mid-1970s, the consumption gap between cities and regions narrowed as did the per capita prefectural income gap between the regions.

One of the factors that stimulated regional economy growth was public investment. Together with a relatively high employment rate in the regions, capital investment contributed to a rise in prefectural income, where the expanded construction industry played a large role in employment. The trend in the public expenditure share of gross fixed capital formation in total prefectural spending suggests that the dependency of the regional economies on public investment lessened in metropolitan areas during the 1970s, while the dependency rate grew in local regions (Figure 24). Again, in the first half of the 1990s, the dependency on public investment rose in local regions. This means that local regions face the challenge of not being too much dependent on public projects but becoming self-reliant.