24 May 2013

Tim Hazledine: Opaque thinking sours our perspective

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By Tim Hazledine
Photo: Doug Sherring
Published: The New Zealand Herald – 24 May 2013

Auckland Council’s Unitary Plan and Fonterra’s milk bottles caused a fuss which could have been avoided.

Products and plans suddenly dumped on the wider market can be quite upsetting.

Products and plans suddenly dumped on the wider market can be quite upsetting.

Surely I am not the only person to note the remarkable similarities between Fonterra’s no-see milk bottles and the Auckland Unitary Plan? Both schemes burst forth fully formed from the bellies of large bureaucratic organisations. Both have aroused instant anger and distress among large segments of the population, presumably to the surprise and concern of their sponsors. And in both cases, the fuss could have been easily avoided, with a modicum of foresight.

Take the wretched opaque milk bottles. This episode seems truly silly. Surely some standard market research could have sorted it out in advance? When I lived in Canada we would read about a town – Cambridge, Ontario – where the social, cultural, economic and demographic characteristics of the residents were a near perfect match with the population of Canada as a whole. A perfectly average little Canadian city.

For some reason I never got around to visiting Cambridge, Ontario, but I was glad it was there. I could rely on the supermarkets and manufacturers using it to quietly test out their new products before deciding whether to launch them – or not (in most cases new products are failures in the market) – on the rest of us.

Couldn’t Fonterra have found such a place in New Zealand? Perhaps our own Cambridge. Or Hamilton itself, for that matter – a lovely city which has always seemed fairly average to me. They could have put new and old milk bottles side by side on the shelves in an extended trial – extended, because in the end we may come around to preferring the new ones – and found out which the punters prefer.

But no, they had to suddenly dump the new product on to the market, telling us firmly that it will be good for us because our milk won’t go off so quickly if we leave it in the sun. And we get upset, okay?

It’s the same story with the Auckland Unitary Plan. Nearly 2000 pages detailing what the city planners and managers think will be good for us in the future development of our city, especially in terms of increasing density and allowing medium-rise development in many suburbs. And folk have got really upset – even more than they are about the milk.

The council has accepted a flimsy forecast of one million extra Auckland residents by 2040, and seemingly taken it to be their responsibility to find, right now, a place for each of those new people to live in. The plan comes across as them – Council and the “planners” – specifying what they want us to do. But it really could have been framed quite differently – a far-sighted council foreseeing what we will want to do, and enabling our wishes to be fulfilled efficiently and enjoyably.

With the wisdom, perhaps, of hindsight, how do I think the matter could have been better handled? First, tell the urban economics story. However the actual numbers turn out, the city will grow, and this will inexorably result in higher land prices. In response to this, and to changing attitudes as to how to make the best of living and working in a bigger city, large numbers of Aucklanders are going to want to have a broader mix of residential and employment options. Then, use case studies of other very attractive cities which are a bit ahead of us on these matters – Vancouver, Melbourne, San Francisco – to show how it can work.

And then, do the “market research”. There’s no need to solve the whole problem in advance. Choose some particularly propitious suburbs or neighbourhoods – places where people are open to these ideas – and try out the options over a few years. Then we can learn from mistakes and also give the rest of the town something to look at. Perhaps it won’t be so scary after all! Possibly one of these experimental suburbs could be my own – Freemans Bay – but it won’t be our street. Why not? Because our street has been done already. Though small, we have a full palette of old and new stand-alone houses, mixed-use duplex terraces, and a substantial commercial building.

I’m happy with this. I’d like us to have a well-understood set of aesthetic etc rules within which architects, developers and property owners can get on with doing their creative stuff, leaving the rest of us free to deal with other important matters, such as trying to figure out whether the milk bottle in the fridge is empty enough that it’s time to get a new one.

Tim Hazledine is a professor of economics in the University of Auckland Business School.



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