The Making of Japan's Railway System: with a Comparison with Britain

The Making of Japan's Railway System: with a Comparison with Britain


J Qian Ying, Gifu University, JP



Why Britain and Japan have a much different railway transport system, even though they are geographically similar island countries? The difference of population density is widely considered as the main factor that makes the difference: high density population in Japan makes it possible for a vertically integrated railway transport system to be profitable and survivable without public funding, while a franchising scheme for train operation on the separated tracks has advantage in efficiency especially for less densely populated countries such as Britain and other European countries (C. Nash, gRailway Policy: comparing Europe with Japanh, Transportation & Economy, ITE, Dec., 2007).
Beside this fundamental factor, in this paper I try to identify other factors in the background of the formation of Japanfs railway system, comparing with that of Britain. Two major factors are as follows.

First, historic factor.
The current structure of Japanfs railway system was established as a result of the regional division and privatisation conducted in 1987, which might be looked as the restoration to the system of regional private companies before their nationalization in 1906. This is in sharp contrast to the case of Britain: one of the plans for the privatisation of the British Railway was to return to the Big Four companies but has not been realized. An important reason for the determination of Japanfs privatization plan was that there had been existing private urban railway companies (eight in Tokyo, one in Nagoya, five in Osaka, and one in Fukuoka) which had been having excellent performance since their establishment during the Meiji era, which had remained private when intercity railway companies were nationalized. These companies have served as models of the current JR group companies.

Second, the difference of the real estate market.
It is well known that real estate business helps railway transport firms increase revenue and make profit. Actually, all major private urban railway firms in Japan have a real estate sector which earns a profit comparable with that of the passenger transport sector. This is possible in Japan because it has a big real estate market. In fact, the per capita house building rate in Japan is about three times that in Britain. The JR group companies (originally Japan National Railway) have only a small real estate sector and a large part of their revenue comes from the Shinkansen bullet train lines which carry intercity passengers. The high share of railway in intercity passenger transport market owes much to the highly developed urban railway networks which provide very convenient access tools for intercity railway lines.

In the paper I will examine in detail how these factors and related social economic background have influenced the formation of Japan's modern railway system, and discuss implications of these Japanese experiences for railway policy.


Association for European Transport