You are subscribed as | Unsubscribe | View online version | Forward to a friend

Insights 28: 5 August 2022
The Australian: Oliver Hartwich on New Zealand's education tragedy
RadioNZ: Corin Dann asks Bryce Wilkinson, what is the ideal jobless rate?
Podcast: Funding roads with Scott Wilson, Eric Crampton and Matthew Birchall

The Commerce Commission’s New Lamp Post
Dr Eric Crampton | Chief Economist |
We all know the old joke that an economist would look for his keys under a lamp post not because that’s where he’d dropped them, but because that’s where the light is.

But sometimes new lamp posts add the necessary extra bit of illumination.

When the government proposed market studies powers for the Commerce Commission, it is fair to say that we at the Initiative were sceptical.

The new tool brought a lot of risk.

It can compel companies to supply the Commission with huge amounts of information, at substantial expense, with no particular checks and balances.

It gives the Minister, who can direct Market Study investigations, the ability to impose tens of millions of dollars of cost on a company, and to tie up its senior executives for months.

It is dangerous.

But it also allows the Commission to shine a light in exactly the place it was previously precluded from looking.

Section 43 of the Commerce Act exempts activities authorised by government.

Government creates and enforces a lot of arrangements that would normally otherwise be called cartels, or at least be considered strongly anticompetitive, if undertaken without the government’s help.

The Commerce Commission has been able to act against other forms of anticompetitive activity.

Statutory regimes have been off-limits and have consequently been the largest remaining source of harm to consumers.

When Market Study powers first arrived, in 2019, I urged the Commission, in a column in Newsroom, to finally examine areas where regulation and legislation have stymied entry.

I noted the effects of zoning on retail competition.

Building materials, where the combination of council incentives under joint-and-several liability and certification regimes also seemed a substantial regulatory barrier to entry, also warranted a close look.

Earlier this year, the Commission released a report pointing to zoning and consenting as a substantial barrier to entry in grocery retail.

This week, the Commission’s draft report on building materials highlighted the substantial government-imposed barriers to entry.

The problems were obvious. Fixing them should not have required the cost of a market study.

But the Commission has been pointing its new light to excellent effect, letting everyone see important detail.

Regulatory barriers preventing foreign doctors from practicing in New Zealand also deserve illumination.

There are keys there to be found in that dark spot.

It needs a lamp post.

Applied history
Dr Matthew Birchall | Research Fellow |
Historians can be a tedious bunch. As someone who frequently hijacks dinner parties with history lectures, I would know. It turns out that there is less popular appetite for lengthy forays into imperial history than I imagined.

But do historians make good public policy analysts? There are two reasons to suggest they do.

Most important is the premium that the discipline places on evidence-based reasoning. Too many of the ideas that currently inform policy in New Zealand seem to be built upon shoddy intellectual foundations.

The past is a wonderful antidote to wishful thinking. Historians are taught to engage closely with source material, and to signpost their findings. You cannot just make it up. For my PhD, I assembled over 40,000 photographs of archival documents. Vast reams of paper never made the cut.

The point here is not that I like reading; it is that scrupulous attention to detail is the bedrock of informed analysis. The advice that the late Newsday editor Alan Hathway gave to Robert A. Caro, the great biographer of LBJ, is surely the definitive statement on the matter: ‘Turn every page. Never assume anything. Turn every goddam page.’ It is hard to feel at home on a fantasy island when you are firmly grounded in reality.

Second, historians can inject much needed context and perspective into contemporary debates. Political commentators do not think twice about making international comparisons, and yet they often overlook historical analogues or precedents. This is a mistake.

My current work on infrastructure in New Zealand is a case in point.

Conventional thinking on the subject focuses on the central state. Julius Vogel and Muldoon’s ‘Think Big’ predominate in this telling. Yet a more careful examination of the documentary record reveals a parallel tradition in which local government played a greater role in project finance. This is the stuff of revenue bonds and special purpose authorities, the precise model that our chief economist Eric Crampton advocates.

There is still much that we do not know. How and why did revenue bonds flourish in the twentieth century? Were they successful? Why did the model fall from grace?

History is contingent, full of caveats, and more than a little dry for dinner party patter. But it is also surprising and a stir to the imagination. The history of New Zealand infrastructure reveals that sometimes the best ideas are hidden in plain sight.

Welcome to Niceness U
Dr James Kierstead | Research Fellow | james.kierstead
Welcome to a new term at the University of Niceness. You may notice a few new things about the place, starting with our name.
Our new name reflects a period of extensive consultation with our Executive Council, our Public Relations department, and a range of external consultancies. We also acknowledge feedback from students and academic staff, much of which we considered.
Our new brand identity reflects our conviction that niceness has to be front and centre of everything we do.
Some in the past have argued that niceness is only one value among others. That niceness isn’t always the appropriate response, even if it might sometimes be. Or even that there are different notions of niceness, and that we need to allow individuals to be free to debate what genuinely constitutes niceness in different situations.
We disagree.
And so it is that we’ve finally arrived, after decades of prioritizing ‘knowledge for its own sake’ and ‘objective truth’ (neither of which things, it turns out, are consistently nice) at our true and sole purpose as an institution. This is of course the crowning moment of our Campaign against Hurt and Dismay, which has been running for a decade now.
A quick update on that.
As some of you might recall, in the opening year of the campaign we made the brave decision to close the Department of Religious Studies because of the offence that some of their content had caused.
The following year, after extensive consultations, we were forced to shut our School of Biology, after concerns raised by several of our on-campus religious communities about their first-year course on evolution.
And three years ago, we decided that the Faculty of Humanities could no longer continue in its existing form because of repeated complaints about the content it exposed students to, from its first-year course on ancient warfare to the now-notorious Shakespeare paper.
But we press on, with our five Offices for Niceness and our two surviving academic faculties.
Oh, and finally – I know that many of you were looking forward to hearing Professor Parrhesia speak later this month, but we were compelled to cancel this event after complaints from three very angry members of our community.
We are, after all, the University of Niceness.  

On The Record

Initiative Activities:   
All Things Considered
  • Graph of the week: A spectacular collapse in sentiment in the residential construction industry is one of the standouts in another gloomy ANZ Business Outlook Survey
  • The insatiable appetites of the Fürstenstadt are a major reason for the decolonisation of the Russian Empire
  • Te Puke, Rotorua jewellery stores repeatedly targeted in break-ins: co-owner speaks out ($)
  • Secondary principals are pushing back against online tests for NCEA credits during the school year
  • “Some Scientists Think” – a thread
  • Alcohol minimum pricing in Scotland isn’t going well
  • Let's talk European electricity, shall we?
Copyright © 2024 The New Zealand Initiative, All Rights Reserved

Unsubscribe me please

Brought to you by outreachcrm