Comments on: Green Hansonism

By: Yobbo

Yobbo — Sat, 31 Jul 2010 11:37:15 +0000

In the one notable example I can think of a large city formed long after original settlement, both these things held true.

1. Business forced to establish in the area due to unfavourable conditions elsewhere.

2. Water available from a nearby underutilised river system.

That city is called Las Vegas.

By: Yobbo

Yobbo — Sat, 31 Jul 2010 11:34:46 +0000

It’s a combination of economies of scale, and heavy subsidisation which further increases the effects of those EoS.

City sizes have a natural limit, which is reached when the population exceeds the size of its water supply. However, extensive subsidisation of water costs mean that most Australian cities are already supporting far more people than their natural size allows.

An average yearly water bill for a house in an Australian capital is around $1000. That price is far too low (not sure exactly by how much), because not only is the government selling those water units to households and businesses on a per unit basis at a loss, but also the price in no way attempts to recoup any of the fixed costs associated with providing that water supply.

And because it’s being sold on a per-unit marginal cost loss, the more water you use, the greater a subsidy you are receiving. And certain businesses are receiving massive subsidies due to getting water basically for free from taxpayers.

Force those high-usage industries to relocate to areas where providing their own water would be simple (e.g. High Rainfall areas or underutilised rivers), would certainly encourage new settlements, but instead Australia chooses to provide free water to everyone and then wonders why people all want to live in the same place.

By: FDB

FDB — Sat, 31 Jul 2010 10:43:43 +0000

“However those sorts of things aren’t really as necessary to founding a city nowadays as they were in the early 19th century.”

So what is it? Market failure? False consciousness?

By: Yobbo

Yobbo — Sat, 31 Jul 2010 10:35:48 +0000

They aren’t completely random, most cities are placed on rivers ajoining natural sea harbors. However those sorts of things aren’t really as necessary to founding a city nowadays as they were in the early 19th century.

By: daddy dave

daddy dave — Sat, 31 Jul 2010 02:59:39 +0000

I should have said path dependency.

This is an interesting point. The placement of cities is somewhat random (somewhat), and thereafter people simply live there because that’s where the city is.

By: .

Fri, 30 Jul 2010 04:08:23 +0000

Well hey the last few days I’ve lost 8 , i, k and , – very frustrating!

By: FDB

FDB — Fri, 30 Jul 2010 03:28:55 +0000

…cue jokes about FDB’s usual legibility: 3…2…1…

By: FDB

FDB — Fri, 30 Jul 2010 03:25:49 +0000

“Actually I think most people want to live near the coast; living “in the city” is a priority for a smaller subset.”

Yes, but most would like healthcare, schools, retail etc too. Sorry, what I write could read oddly today – the keys betwee ‘b’ ad ‘,’ are faulty o this shitty keyboard, so I’ll try to use words without those 2 letters.

By: .

Fri, 30 Jul 2010 02:17:30 +0000

Which is the point Yobbo and I are partly making. You’d see a regional Balassa-Samuelson effect – developing new areas would be cheaper as capacity is not already running high.

By: daddy dave

daddy dave — Fri, 30 Jul 2010 01:33:38 +0000

Governments AND business would prefer to build where it’s cheap and easy to do so, and that’s near existing economies of scale

Only to an extent. Economy of scale is only one factor of many to weigh up. Planning bodies evaluate new housing projects, for example, on whether they use “existing infrastructure” or not, and will reject the ones that don’t. Look at the fight over Huntlee in the Hunter Valley, for example. So basically developers are being told to load more and more resources onto the already overloaded existing infrastructure.