Welcome back to Sunday reading.
This week, I want to highlight a really important article by Joe Cortright (City Observatory): “Going faster doesn’t make you happier; you just drive farther“:
We’ve long assumed that one of the goals of our transportation system is to enable us to move as quickly as possible when we travel, so it stands to reason that the people who live in “faster” cities ought to be happier with their transportation systems…
The following chart shows happiness with the regional transportation system on the vertical axis, and average speed on the horizontal axis. Higher values on the vertical (happiness) scale indicate greater satisfaction; larger values on the horizontal (speed) scale indicate faster than average travel speeds. The data show a weak negative relationship that falls short of conventional significancel tests (p = .16). While there isn’t a strong relationship between speed and happiness, if anything it leans towards being a negative one; those who live in “faster” cities are not happier with their transportation system than those who live in slower ones.
Cortright goes on to investigate this relationship in more detail. It turns out that the main effect of faster speeds is that people travel longer distances. And travelling longer distance is associated with less happiness:
To tie this all together, we thought we’d look at one more relationship: How does distance traveled affect happiness with an area’s transportation system? This final chart shows the happiness (on the vertical axis) and vehicle miles traveled (on the horizontal axis). Here there is a strong negative relationship: the further residents drive on a daily basis, the less happy they are with their metro area’s transportation system.
We think this chart has an important implication for thinking about cities and transportation. Instead of focusing on speed, which seems to have little if any relationship to how people view the quality of their transportation system, we ought to be looking for ways to influence land use patterns so that people to have to travel as far. If we could figure out ways to enable shorter trips and less travel, we’d have happier citizens.
Traffic engineering consistently advocates trading off place for speed, reasoning that faster traffic will give people more choice and opportunities for happiness. But if that isn’t the case, then the profession is damaging people’s health and happiness for no good purpose other than blind adherence to an incorrect idea. Engage with the evidence, traffic engineers!
IMAGE: Train station in Denmark pic.twitter.com/SzKklZy1A2
— The Spectator Index (@spectatorindex) March 18, 2017
Speaking of mythbusting, University of Auckland professor Alistair Woodward has just released some new research on the safety risks of cycling. He explains his findings in a blog post:
We found the risk of injury while riding a bike is actually very small. Taking injuries that lead to claims to ACC, we found these occur roughly 9 times in every 100,000 short urban bike trips; the chance of receiving an injury sufficiently severe to cause a visit to the hospital was similar. If you rode a bike three times a week, most weeks, the chances are you would suffer one moderately severe injury every 70 years.
We estimate the risk of injury on a bike is similar to the risk associated with DIY activities in the home, more than a 100 times less than the risk of snow sports, and 500 times safer than playing rugby (see Figure 1, which uses a log scale).
There are many assumptions and approximations in these results, so they should not be treated as precise measures. But the take home message, we suggest, is that riding a bike on New Zealand roads is not particularly dangerous (1 moderate injury in 70 years!), and indeed the risk is considerably less than that associated with some other common activities. (Many parents are reluctant to allow their children to ride to sports, but the bike trip is roughly 500 times safer than a game of rugby, for instance).
Woodward concludes with a suggestion:
The most powerful way to bring bikes back from the margin is to provide safe spaces for cyclists of all abilities to get to where they want to ride. Separated cycle ways are part of the fix, but not enough. There need to be changes on the road as well, such as slower vehicle speeds, better intersections, and wider shoulders to include cyclists. More people riding, and public spaces that celebrate two wheeled choices, will do two things – make cycling (even) safer, and reduce the fear of the bike.
David Attenborough's next series on urban life on earth… pic.twitter.com/8oHJ5u5nBR
— Ben Hamilton-Baillie (@benhbaillie) March 16, 2017
On a related note, a new piece of research from the US looks at the reasons why people on bikes break some traffic rules. According to the press release from the University of Nebraska-Lincoln: “Study reveals a ‘Wild West’ with rules of the biking road“. It highlights the importance of poorly thought-out road rules and hostile driver behaviour in conditioning some cycling behaviours:
Just as many drivers accept violations of speed limit laws as the norm in certain situations, bicyclists often accept violations of some traffic regulations as the norm under certain circumstances.
However, based upon a recent survey of more than 14,000 Americans, consensus is lacking on how bicyclists should safely maneuver through mixed traffic. Depending upon their bicycling experience, motorists can have very conflicting views on appropriate biking behavior amid automobiles.
The uncertainty about how someone should ride a bike in traffic can be dangerous if a motorist responds aggressively to a cyclist’s actions. Aggressive driving contributes to accidents and near misses. That, in turn, scares many people away from biking.
“We know it’s the Wild West out there,” said Daniel P. Piatkowski, assistant professor in the community and regional planning program of the College of Architecture at Nebraska. “There are all these conflicting ideas of how a bike rider should behave — some legal, some illegal. We found that, regardless of how people are riding, most are doing so to avoid being injured or killed by a driver.”
One interesting finding from the study was that drivers often have hostile (and potentially life-destroying) responses to legal behaviours such as ‘taking the lane’:
“When a perfectly legal bicycling maneuver like taking the middle of the lane elicits an aggressive response from a significant number of drivers, that is a big problem,” Marshall said. “This sort of disconnect helps explain a lot of the behaviors we’re seeing out there.”
And now for something completely different. Footrot Flats cartoonist Murray Ball died last week. He’d been ill and out of the public eye for years, but it was still sad to hear as I’d grown up with his characters. By all accounts, he was a thoroughly decent bloke who stood up for a kinder, more inclusive society. So in memory of Murray Ball here’s Jane Thompsen’s 1984 profile of him at work at his place in Gisborne:
by Jane Thompsen, originally appeared in School Journal, 1984, Part 4, number 2.
AT NINE O’CLOCK every morning, from Monday to Thursday, Murray Ball goes to a quiet place to think of ideas for his cartoons.
He might go to the top of a hill near his house, or under a tree in the garden. It has to be somewhere he won’t be disturbed—because he needs to sit down, make himself comfortable, and go into a kind of a dream. It is almost like going through a door, shutting it behind him and finding himself in another world—the topsy-turvy world of Footrot Flats.
Many characters whom he knows very well live in that world. There’s Wal, a farmer, thoughtless and dour and mean, who also has some good qualities—he would never do anything dishonest. There’s his dog, who adores him and would do anything for him, although he tends to be rather greedy and jealous. There’s Cooch, a much more sensitive farmer, who even tries to protect pests such as blackberry and possums. There’s fussy Aunt Dolly, who tries to tell Wal what to do. There’s a big fierce cat called Horse who terrifies many of the other characters. There are a cow, a goat, geese, a ram called Cecil, a corgi dog called Prince Charles, a girl called Pongo, a boy called Rangi, and many other characters.
They are all very real to Murray Ball, and so are the places where they live. He knows just what Wal’s back door looks like, and his living room, and the kennel where the dog lives, and so on.
But there’s something wrong with that world when Murray Ball goes into it every morning. He can’t just lean over the fence and enjoy watching it, because it’s all standing still—nothing’s happening. And nothing will happen until he thinks something up.
I read once that Murray Ball decided to wrap Footrot Flats up in the early 1990s, after the Rogernomics revolution had dismantled the economic underpinnings of his fictitious world. Things have certainly continued changing, both in positive and negative ways, since then.
In the New York Times, Patricia Cohen reports on some new research into the causes of rising income inequality: “‘Superstar firms’ may have shrunk workers’ share of income“. It’s an interesting piece of the economic puzzle:
From manufacturing to retailing, giant companies have managed to gobble up a larger and larger share of the market.
While such concentration has resulted in enormous profits for investors and owners of behemoths like Facebook, Google and Amazon, this type of “winner take most” competition may not be so good for workers as a whole. Over the last 30 years, their share of the total income kitty has been eroding. And the industries where concentration is the greatest is where labor’s share has dropped the most, according to research that analyzed confidential financial data from hundreds of companies.
Think about the retail sector, where mom-and-pop stores once crowded the landscape. Now it is dominated by a handful of giants like Walmart, Target and Costco.
Research has shown that in pretty much every industry, most of the income differential among workers is not a result of a chasm between the highest and lowest paychecks within one company, but rather differences among companies.
Larger companies tend to pay better than smaller ones, Mr. Autor and the other researchers say, and in the technology sector especially, salaries can be impressive. Workers there are sharing in the larger pie — there are just fewer of them to do so.
The researchers examined six industries that account for 80 percent of private employment in the United States. In each one, they discovered “a remarkably consistent upward trend in concentration.” In manufacturing, for instance, the top four companies controlled 43 percent of sales in 2012, up from 38 percent in 1982. In finance, the figure grew to 35 percent, from 24 percent, and in retail trade it went to 30 percent, from 15 percent.
The faster concentration grew, the bigger the drop in labor’s share.
“What’s different about new superstar firms is they don’t have the cadre of middle-class jobs for nonelite workers,” said Mr. Katz, an economics professor at Harvard.
For what it’s worth, economists are generally not in favour of highly concentrated markets, at least when they result from some sort of barrier to entry or monopoly power. But I think there is some degree of confusion about why firm concentration is happening, and whether it has some broader negative effects.
To conclude, something on the Auckland housing market. To help launch the news venture Newsroom, Bernard Hickey wrote a great article on the current state of the Auckland housing market… and the unanticipated barriers to fixing it. It’s well worth reading in full:
So surely someone has tried to fix the RMA and remove those council funding restraints?
The combination of Auckland’s councils into the Super City was supposed to make it easier to grow, as was the passing of the one plan for them all — the Unitary Plan – which extended the city’s boundaries for new suburbs and changed the rules to make it easier to build apartments, terrace houses and townhouses closer to the CBD.
The Government has also tweaked the RMA a few times and introduced a stop-gap measure called the Special Housing Areas (SHA) Act. It pushed through some developments in a faster timeframe than the RMA, but it expired late last year. The Government hopes the Unitary Plan and a new National Policy Statement on Urban Development will nudge councils to fund and approve the infrastructure needed to support new houses.
The Government has also offered $1 billion to help Councils fund the pipes and roads needed to bring forward housing development. It hasn’t approved any projects yet and Prime Minister Bill English has already pushed back at some of the proposals, saying they aren’t really bringing forward new projects, but are only funding projects already in the plan. Approvals are many months away, or even longer. There is still a debate to be had about the structure of the vehicles that build and own this infrastructure, so this funding is no quick fix.
Auckland Mayor Phil Goff has tried to get another tool to deal with a $4 billion shortfall in transport funding in coming years, but his idea of a regional fuel tax was rejected outright this month by Finance Minister Steven Joyce. Revenues from GPS-style congestion charging are still up to a decade away.
The short answer is the funding restraints for infrastructure development are not solved yet, with the biggest problem being the Council has few incentives to invest heavily for growth when the Government in Wellington gets most of the benefits and does not have to pay for local roads, some of the railways and none of the pipes.
But that’s it right?
No. Unfortunately, the RMA and infrastructure funding issues are not the only blockages to new houses being built. Risk of losses in any downturn, access to bank loans and land banking are also issues.
Most developers buying the land for a development, paying for the plans and contributing to the infrastructure need to borrow the money from a bank. To do that, they need to be confident they can sell the development to rental property investors, first home buyers and others, and then prove that to the bank.
The developer has to be confident they will not be left holding the parcel of land or a half-built apartment if the market suddenly cools and buyers can’t or won’t stump up the balance between their deposits and the sale price. They also have to be confident that construction or legal costs won’t blow out over the time it takes to get resource and building consents and funding.
Meanwhile, the banks have to be confident they’re not going to be left holding an unpaid loan to a developer if the market suddenly grinds to a halt and land prices start falling. The best example of what a property development loan looks like to a lender when the music stops is what happened from 2007 to 2012 when finance companies collapsed because they were stuck with empty holes in the ground all over Auckland and Queenstown. Finance company investors and a couple of overseas banks – Bank of Scotland in particular – had to book big losses. […]
The toughest of all the knots is the way developers and new home buyers feel about market risk when house prices have trebled in 15 years and house price to income multiples are well over 10 – three times what most international experts consider an affordable level. No one wants to buy if they think a market is peaking. It creates a Catch 22: very high prices both encourage and discourage development, depending on how close the cycle is to peaking.
That’s it for the week – see you next time!