2018 ProSPER.Net Young Researchers' School Lecture summary prepared by Yu Shi (Tongji University) & Godwin Festival Boateng (RMIT University)

1. One Page Summary
Yu SHI & festival.
Lecture 8: Municipalities’ Management of Urban Development – Exploring Non-
Binding Impact Fee System for Housing Development in 1970s Japan
The lecture firstly explained the origin of the Non-Binding Impact Fee System for
housing development in 1970s Japan. It started with the rapid housing development
accompanied with high economic growth in 1960s, which increase the demands for
the investment in public infrastructure. Then the administrative guidance was put
forward by the government, but it had no legal binding for land developers. The lack
of binding force caused tension between municipalities’ demands and non-compliant
development. Also, the demand for housing development started to decrease.
Accordingly, many municipalities refrained, such as Yokohama. The administrative
guideline on impact fee in Yokohama was introduced. The revaluating work was then
introduced. The concept of “soft law” was introduced by the speaker. Soft laws are one
of the social norms for fairness as hard law is and gives municipalities broader
discretion, which does not require rigid process as hard law. The speaker uses the
criterion of “loss from incompliance” and “profit from compliance” to revaluate the
guidance. He interviewed the city officers of Yokohama government to study why the
guidance worked well in Yokohama. He found that for soft law to work well, the
subjective profit from compliance or loss from incompliance should be maximized.
Then it should strengthen the priority of long term profit.
With the practice of impact fee system in Japan, it could provide some experience for
developing countries, which is most of the students care about. In the discussion, we
can find that the conditions in some developing countries are quite different from that
in Japan. In Japan, the legal level is relatively higher than other countries. For example,
some people in Pakistan are not willing to pay the tax, which means the hard laws
cannot be implemented well, not to mention soft laws. The speaker suggested that
even the hard law is strict, it should always consider the people’s compliance intention.
Also, the tax should not directly connect to the benefits of government or individuals,
in which way the government could lose the trust of the public. The tax can be
promised to build school for the public, which benefits the public, and the government
have to keep promise.
The practice of YOKOHAMA was successful, but it cannot directly be transformed to
developing countries because of the different political system, legal system and level
of development. More studies have to be done to find the key elements of the
municipalities’ management. Many policies in developing countries was just promoted
and changed, the revaluation of policies should be emphasized, which could help the
government develop more effective policies and laws. The cooperation between
government from different countries should be encouraged.