Urban redevelopment and residential location choice: Evidence from a major earthquake in Japan

We examine residential location choice behavior in a metropolitan area of Japan that experienced seismic damage. We find that the internal structure of the affected area was reshaped, although, in the long term, its total population size was robust to this temporary shock. Before the earthquake, the population was evolving toward a state of equilibrium with dense locations in the core facing redevelopment barriers and, therefore, stagnation. In contrast, the periphery was becoming increasingly appealing and thus growing. Seismic damage allowed for redevelopment at higher density, making the adjusted equilibrium with dense locations grow again. In summary, the initially expanding periphery stagnated as an unintended consequence of urban redevelopment.