Housing supply and demand in New Zealand

Via the Radio New Zealand podcast, I just heard a story about the “catastrophic” condition of New Zealand’s housing market. The piece referred to a report claiming New Zealand’s housing market is the least affordable of the 22 countries it analyzed. My attention: you have it. This article is a shorter version of the radio piece.

The presenter maintained neutrality about the cause, but thankfully Property Countil chief executive Connal Townsend spelled it out for listeners:

It’s a catastrophic regulatory failure.

Decisions were made years ago to artificially constrain the availability of land and it’s the golden law of economics that when you, through regulation, constrain the supply of a commodity it drives the price up.

Prices are signals about resource allocation. In rising they signal to producers to increase production. If they don’t respond, there must be a reason.

I can’t remember the name of the Green Party spokesman who presented the other point, and it’s not included in the web version, but he suggested the problem was…wait for it…a lack of government action.

If I can be forgiven for using Thomas Sowell’s phrase “a conflict of visions” for my own purposes, it’s the perfect phrase here. The rational choice worldview that considers incentives has a very elegant and empirically-supported answer. The social creationist worldview imagines the whole thing to be the result of society’s inability to adjust itself, for mysterious reasons, which planners must counteract by conscious effort.

New Zealand readers may object that I know nothing about the specifics of the situation. They’d be right. I’m not from New Zealand, have never been there, and mainly listen to the podcast for the great accents while I do Saturday morning chores. But there are constants in human behavior. People in New Zealand, like people everywhere, respond to incentives unless prevented from doing so.

It may be that land use restrictions intended to minimize the impact of humans on New Zealand’s famous natural beauty are at the same time 1) the culprit in the housing price situation and 2) justified anyway for other reasons. That’s a reasonable position to hold—as long as you acknowledge the cost.

Bonus question: which segments of New Zealand society are worst off in this situation?

Lessons from Making a Murderer

[Warning: contains spoilers.]

The documentary series Making a Murderer is making the rounds in the media right now after being released in mid-December. I watched it all over just a few days and recommend it highly. Here are some thoughts about its implications.

[Warning: contains spoilers.]

1. Part of the show’s message is that Avery is probably innocent. Another part is that he was not given a fair trial, nor was his nephew. In the nephew’s case it seems very clear that his confession was manipulated and should be thrown out. As far as Avery goes, the series presents him as innocent but a quick search around the internet will give some reasons to think he was not. I don’t know, but police and prosecutors didn’t appear to act fairly. On balance it seems to me the reasonable doubt criterion was satisfied.

More broadly, beyond this case, police and prosecutors have powers—both de jure and de facto—that would blow the average citizen’s mind to find out. Regardless of Avery’s guilt or innocence I’m glad to see the presentation of what the state’s side of the legal system is capable of. The public may think it’s a good thing on net, but they need to know what kind of tool it is. It can be used for good purposes, yes, but there’s no guarantee of that. People know this abstractly, but the concrete portrayal in the series does the Lord’s work. (Regrettably, the Annie Dookhan case had very little impact.)

How often are situations like this happening all over the country? Probably every day. One of the things I thought as I watched was how taxing being a good judge must be. As a judge you inevitably preside over and influence false positives and false negatives, and beyond knowing these are possible there is really no way to know which is which in any case. My subjective impression is that most judges tend to side with the state more or less automatically, sacrificing quality for comfort.

2. What the purpose of law enforcement? Really the question is what are the purposes of law enforcement? (Here I take the broadest view of law enforcement systems, including those in societies that don’t/didn’t have dedicated state apparatus for it e.g. medieval Iceland, pre-contact American Indian groups, etc.) One of the purposes is to keep order. Societies that are too disordered don’t allow for human flourishing. Another purpose is to set the public’s mind at ease. In general, people will tolerate quite a few questionable cases if they think the system overall is working (from their perspective; if you’re on the receiving end of a questionable case you don’t feel that way). While I don’t like it I can see why police and prosecutors would zero in on suspects they think they can convict at the expense of exploring other less certain investigative paths. This is why protections for the accused are so important and why Brendan Dassey’s manipulated confession was so heinous.1 If people can be punished for crimes they didn’t commit, i.e. if their choices and their life outcomes are severely disconnected by non-random events, we are back to the disordered society.

3. Imagine the details of this case being substantially the same, only in Mississippi and with the accused being black. Now go back to the case as it happened. What are the essential components of both stories? So I’m not misunderstood, I don’t doubt racism influences the legal system. What I’m saying is there is more than one troubling factor at play. There is only so much social attention to devote to the list of social problems, and society may prefer to focus on racism inside and outside of the legal system more than other problems within the legal system, but tradeoffs always exist.

1. How many of the people who are outraged about this case also think lower evidentiary standards for college rape tribunals are a good idea?