Japanese Journal of Human Geography 64―5（2012） Competitiveness of Japanese Functional Urban Areas（ JFUAs） : Empirical Testing of the Pyramid Model Éva Komlósi Graduate Research Assistant Faculty of Business and Economics, University of Pecs FUJII Tadashi Tottori University I Introduction In the present study, we propose a possible method to ascertain the competitiveness of spatial units in a more objective manner, and thereby contribute to the underpinning and ex―post assessment of regional planning. Only in the last few decades has the concept of regional competitiveness received particular attention in regional development policy. Regional competitiveness especially has become a widely celebrated notion in policy―making circles : national, regional and city authorities have been propelled by an overwhelming urge to create indexes to measure and compare their positions with that of others and to invent strategies to enhance their competitiveness（ Gardiner― Martin―Tyler 2004）. Even though the concept has gained quick and ardent acceptance from practitioners, since its appearance, it has also induced a heated debate in academic circles, because it has raised serious doubts about interpretability. Perhaps the most critical opinion about regional competitiveness was expressed by Krugman, who called it a “dangerous obsession”. According to Krugman’s explanation, competitiveness is a feature of firms, not of nations. Krugman argues that the principle of comparative advantage assures that every nation can become a winner and, therefore, there is no meaning to talk about competitiveness（ Krugman 1996）. However, in his latter study, Krugman admitted that “at a regional level, however, the story changes drastically …” （Krugman 2003, 18）. What Krugman seems to affirm is that spatial units under the national level work on the basis of absolute rather than comparative advantage （Martin 2005）. A dozen spatial units under the national level do indeed compete to attract, or at least withhold, human capital and companies from other regions by offering a set of embedded region―specific givens （e. g. specialized knowledge, a skillful workforce, infrastructure, tax allowance, public services） which offer absolute advantage （i. e. higher productivity） for companies, and by this generate additional influx of people and capital （Boschma 2004 ; Bristow 2005 ; Bud―Hirmis 2004 ; Camagni 2002 ; Martin 2005）. Therefore, understanding regional competitiveness has become a matter of vital importance. It is clear that the earlier dismissive opinions have begun to recede or change. Nonetheless, the growing acceptance of regional competitiveness in academic circles has given rise to an array of questions : What is exactly regional competitiveness ? How can it be measured ? The full ― 54 ― Competitiveness of Japanese Functional Urban Areas（ JFUAs） : Empirical Testing of the Pyramid Model（ Komlósi and FUJII） 435 consensus of researchers has clearly expressed that there is a need for a comprehensive th definition. The “standard concept of competitiveness”, published in the 6 periodical report of the European Commission, was partly developed to serve this purpose : ［“ Competitiveness is defined as］ the ability to produce goods and services which meet the test of international markets, while at the same time maintaining high and sustainable levels of income … and employment levels …” （European Commission 1999, 4）. Resilience, as one main feature of this definition, is readily adaptable to a broad range of economic units （e. g. nations, regions, sectors, companies）. On the other hand, this definition possesses the advantage of working with measurable economic categories（ Lengyel 2004）. The Pyramid Model of regional competitiveness published by Lengyel is built on this standard definition. This model provides a systematic account by identifying the possible factors responsible for competitiveness （Lengyel 2003, 2004）. Other models also exist for measuring regional competitiveness（ Kitson―Martin―Tyler 2004 ; Snieška―Bruneckienė 2009）. For two reasons, Lengyel’ s Pyramid Model was preferred : ⑴ its structure corresponds to the input―output―outcome logic in line with international recommendations, and ⑵ its elements can easily be converted into indicators （Lukovics 2007）. The model has gained wide academic consensus and has been employed in several studies of spatial analysis（ Gardiner―Martin―Tyler 2004 ; Garlick 2003 ; Parkinson et al. 2006 ; Sinabell et al. 2011）. The first comprehensive empirical test of the Pyramid Model was accomplished by Lukovics （Lukovics 2007, 2008）, who classified Hungarian micro―regions according to their competitiveness. To minimize subjectivity, he suggested useful methodological solutions and a multi ―stage process to denote the relevant set of variables for measuring competitiveness. Applicability, comparability in time and elimination of redundancy are the main advantages of his method. In this paper, the competitiveness of 141 Japanese Functional Urban Areas （JFUAs） was measured based on the methodological instruction of Lukovics. The following section explains about the method and results of the delineation of urban areas, which were used as spatial units in this analysis. Next, we discuss the selection method of relevant indicators which represented the Pyramid Model. Finally, we summarize the substantial outcomes of the cluster analysis and present the significance of the applying Pyramid Model into Japanese urban areas. The main objective of this analysis was to determine what differences could be observed among JFUAs regarding their competitiveness and find out which factors were responsible for their differentiation. The investigation indicated a detailed insight into the mechanism of urban competitiveness which can be used to ground and evaluate the effects of regional planning policies. II Defining Japanese Functional Urban Areas（ JFUAs） Finding the proper spatial unit is one of the most critical steps in spatial analysis. The city, as a local administrative unit, seems less and less able to serve in this role, because of intensive commuting. Therefore, the urban area, which consists of a central city and its hinterland, seemed a better choice. A symbiotic relationship holds the central city and its hinterland together. The attraction zone, in this case, connects to the core city through working commuting flows. Yet another question is what definition to use to designate urban areas. Various methods have been elaborated by researchers to provide a reliable solution to the delineation of Japanese urban ― 55 ― 436 Japanese Journal of Human Geography 64―5（2012） Table 1. Four categories of JFUAs according to areas （Kanemoto ―Tokuoka 2002 ; Kawashima 1982 ; their population Osada 2003 ; Yamada―Tokuoka 1991 ; Yamagami 2006）. Name of JFUA Number Abbreviation Population Finding a proper index to express the urban category of JFUAs character of the central city is a decisive ― Small JFUA S 50 000 249 999 66 point. This is the crucial point in which the ― ― Medium sized JFUA M 250 000 499 999 33 various solutions differ most from each other. Large JFAU L 500 000―999 999 28 （ ） Yamagami 2006 criticized earlier methods ― Largest JFUA LS 1 000 000 14 because the population limit of the central Source : based on data edited by the authors city was too “loose”. One common point of the methods suggested by Kawashima （1982）, Yamada―Tokuoka（ 1991） and Yamagami（ 2006） is that, to express urban character, they used the ratio of daytime to night―time population. Osada（ 2003） emphasized that this indicator includes the number of students and, therefore, is not proper. Both Kanemoto―Tokuoka（ 2002） and Osada （2003） criticized earlier methods using the proportion of non―agricultural workers, because this type of criterion became redundant. To overcome these shortcomings, both authors developed their own respective methods. But their indexes, which represent urban character, differ significantly. Osada proposed the administratively defined urban area, i. e. “shi”, as a suitable index to denote the central city. However, the “shi” area, by itself, does not perfectly express urban character. Therefore, the value of the settlement size in population was employed as an additional criterion（ Osada 2003）. Kanemoto―Tokuoka（ 2002） proposed another metropolitan―area definition known as the Urban Employment Area（ UEA） and, as a qualification of central cities, they used Densely Inhabited District （DID）. Both indexes are equally appropriate to express urban character. Nevertheless, we preferred Osada’s approach, because in his method the “cut of points” of the central city and its suburban area were calculated, which increases the objectivity of the delineation. However, in spite of the conspicuous differences of the methods, attention should be paid to some similarities. In both cases, Tokyo JFUA （UEA） include Saitama, Yokohama, Chiba and Kawasaki cities, while Osaka JFUA（ UEA） does not include Kobe City and Nagoya JFUA（ UEA） does not include Toyota City. Since the main aim of the study was to examine the present competitiveness of JFUAs, therefore, we have endeavoured to use the most recent available dataset. All data for defining JFUAs were available for the municipal level and for 2005 provided by the Statistics Bureau of Japan（ e―Stat database）. In 2005, 141 JFUAs were determined by the following criteria : 1．） Each JFUA consists of a JFUA core and a ring area. 2．） The total of each JFUA contains 50,000 or more inhabitants. The JFUA core must satisfy