Compact city strategies increase care burdens in shrinking small municipalities

As populations decline and age across the developed world, compact city strategies, which oversee the consolidation of urban facilities and guiding residents toward transit-served hubs, have become mainstream policies. Yet most evidence around their benefits comes from cities that are already compact. Far less is known about the social costs that may arise during the transition to compactness in the small and medium-sized cities (SMCs) most exposed to shrinkage. 

Associate Professor Haruka Kato at Osaka Metropolitan University's Graduate School of Human Life and Ecology examined the short-term effects of Japan's Location Optimization Plan (LOP), a nationally promoted compact city policy adopted by municipalities since 2016. Using a nationwide quasi-experimental analysis of 1,595 SMCs from 2008 to 2022, the study estimated how the policy was associated with total population, inter-municipal net migration, and Long-Term Care Insurance (LTCI) certification counts, which give insight into municipal-level care needs and service burdens. 

The results showed that LOP adoption was associated with a more negative population trend in SMCs overall, while no robust effect was detected on inter-municipal net migration. Welfare-related patterns were concentrated in small municipalities with populations under 50,000. In these municipalities, plans that included government and educational facilities were associated with higher care-support certification counts, but patterns among long-term care certifications prompted caution regarding their interpretation. Furthermore, these findings suggest welfare consequences of compact-city strategies are context- and design-dependent, and that facility type should be treated as the center of future policies. Small cities may need to adopt smart decline principles that prioritize well-being and sustainable service provision on a case-by-case basis. In contrast, medium-sized cities showed no statistically significant changes in LTCI certification outcomes across facility types. 

Compact city strategies are designed to sustain urban services over the long term, but our results show that the transition itself can come at a cost. In the smallest cities, consolidating key community facilities was linked to rising burdens in care services. Rather than applying a one-size-fits-all prescription, these cities may need to adopt smart-decline principles that put residents' immediate well-being first, being highly selective about which facilities to consolidate and pairing any consolidation with accessibility safeguards." 

Dr. Haruka Kato, Osaka Metropolitan University's Graduate School of Human Life and Ecology

The findings were published in Sustainable Cities and Society.