Japan's economy is entering a new phase of economic growth through the so-called “lost 15 years” since 1990. Particularly Tokyo and Aichi prefectures have been drawing attention as engine of new economic growth in Japan. Although the recovery of Japan's economy has resulted in an increase in the demand for traffic, construction of new roads in rural areas has been located in a serious situation. It is attributed to a decreasing trend in Japan's population and aging. Thus Japan's national budget will be being reduced in the future. On the other hand, the environmental issues that Japan is facing are becoming serious as well. Japan is one of countries which have ratified Kyoto Protocol, but attaining the target of Kyoto Protocol seems to be very difficult for Japan. Particularly the carbon dioxide emissions from the motor vehicles have still been showing an increasing trend. Thus one can observe a dilemma between the growing demand for traffic and the increasing environmental load in Japan. So this article aims at finding a solution for this dilemma developing an economy-transport-environment interactive model from the spatial point of view. In this study, Aichi, Shizuoka, and Nagano prefectures in Japan are taken as a study region, and then economy-transport-environment interactions are investigated focusing upon emissions of carbon dioxide, nitrogen oxide, sulfur oxide, and suspended particulate matter.

JEL Classification: Q53, Q55, R41