Cities that struggle with population decline may have found a powerful remedy – investing in children. New research shows that small and medium-sized cities that allocate more funds to child welfare have successfully alleviated and even reversed population losses, while those who have increased spending on elderly care continue to shrink.
A comprehensive study of 1,560 Japanese cities conducted by Dr. Haruka Kato, Metropolitan University, Osaka found that between 2007 and 2022, 82% of Japan’s small and medium-sized cities experienced a population decline. However, among cities that strategically redirect municipal budgets, small and medium-sized cities in Japan are very different.
“Our research clearly shows that prioritizing child welfare spending is a key strategy for maintaining populations in small and medium-sized cities,” said Dr. Kato, who published the findings in the Journal of Urban Management.
The study identified a specific threshold – a city with a positive population growth of 50,000 yen (about $330) per capita. On the contrary, cities that increase spending on elderly welfare and public assistance programs continue to decline.
This counterintuitive finding challenges traditional ideas about supporting the aging population. Although Japan faces one of the world’s worst population crises, with 65% of its population, studies show that municipalities that focus resources on young families have long created more sustainable communities.
The method of this study provides anomalous clarity by examining 15-year data from the minimum inflation period in Japan (2007-2022), allowing researchers to make direct spending comparisons without adjusting for currency fluctuations. Advanced statistical techniques reveal the nonlinear relationship between specific expenditures and population outcomes.
In addition to child welfare, other municipal expenditure factors are associated with population stability, including street maintenance, administrative improvement and more efficient allocation of assembly resources. It is worth noting that increased spending in business and industry is not positively correlated with population growth in small and medium-sized cities.
These findings provide a potential roadmap for many cities across the developed world. Research shows that while Japan is still in its worst situation, about 20% of European cities and 23% of Chinese cities are declining populations.
Dr. Kato’s research raises important ethical issues regarding resource allocation. While shifting spending toward children seems to be effective in stabilizing the population effectively, it may risk insufficient support for older residents and welfare recipients. The study suggests that national governments may need to take greater responsibility for these vulnerable populations while keeping municipalities focused on family-friendly investments.
For urban planners and policymakers facing population challenges around the world, this message seems clear: Investing in the youngest citizens may be the most effective strategy to ensure the future of cities.
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