Japan's railway system is considered one of the best in the world, with a high percentage of passenger kilometers traveled by rail and a large operating profit with minimal public subsidy. The system's success is attributed to good public policy, including a business structure that allows railway companies to engage in side businesses, liberal land use rules, and sound regulation. Japan's railway companies are mostly private and compete with each other, which has driven innovation and efficiency. The country's urban planning approach, which emphasizes transit-oriented development, has also contributed to the success of the railway system.