Question

Migration of people from the rural areas to urban areas is rapidly increasing in Japan why​

Answer 1

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the natural welfare function is the value of the economy's output minus resource costs. Since capital inputs are fixed in the previous models, capital costs can be disregarded in characterizing the social optimum, with the only resource cost being the commuting cost incurred by urban residents. Aggregate commuting cost is given by ACC≡∫0x¯[2πx/q(x,N))]txdx, where q(x,N) is land consumption at distance x from the urban center and 1/q(x,N) equals population density.

Answer 2

Is the city size generated by the rural–urban migration equilibrium efficient, maximizing social welfare? To answer this question in the present context, the natural welfare function is the value of the economy's output minus resource costs. Since capital inputs are fixed in the previous models, capital costs can be disregarded in characterizing the social optimum, with the only resource cost being the commuting cost incurred by urban residents. Aggregate commuting cost is given by , where q(x,N) is land consumption at distance x from the urban center and 1/q(x,N) equals population density. N is an argument of q because individual land consumption is in general a decreasing function of the city's population, as shown by Wheaton (1974).

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