Food: Getting lost in social constructivism

After reading both the Stuff article and the initial article on Gareth Morgan’s blog and the follow up, I am convinced both Gareth and Geoff Simmons (GG) have inadvertently become extreme social constructivists – but may not realise it yet.

Now I hate it when people just whip out rhetoric like “social constructivist” and don’t explain it – so what do I mean, how have they gone this way, and what do we know about this type of framework so we can analyse it?

Read more

Caution advised before using Tourism Industry Association numbers

The Tourism Industry Association New Zealand (TIA) has recently released an array of regionally-tailored media releases in conjunction with its Tourism 2014 Election Manifesto. Although we welcome healthy debate on economic issues in regional New Zealand, we are dubious of the methodology used to estimate regional tourism employment and advise extreme caution beforeutilising any of the TIA’s regional data.

The TIA’s report generates extremely unusual results. For example, the Association claims that 15%of Upper Hutt residents’ jobs depend on the tourism industry, while only 9% of residents’ jobs in Queenstown-Lakes District depend on tourism. This result defies logic and an assessment of the TIA’s methodology suggests that it should be taken with a grain of salt.

Read more

Epsom Property Rights

I had been thinking a bit about the apparent inconsistency between David Seymour arguing against intensification in Epsom whilst simultaneously being part of the ACT party, which wants to repeal the RMA is generally against regulations.  I first read about it in Russell Brown’s post The Ides of Epsom.

Apparently, Seymour reconciles these things through appealing to an argument about “property rights”

What I’m arguing is that the people of Epsom have bought into certain property rights and the character of their community …

Now, most economists would agree that it is important to have a good system of property rights,so I was intrigued by this argument. I was going to examine this issue myself, but Eric Crampton has put this to bed quite succinctly in the tweet below. As Eric points out, unless there is a covenant in place, there is no “deal” that is being broken, which is what economists would be worried by.

Update: Eric has a much fuller discussion on his blog here

Minimum wage: International comparisons

Via a Timothy Taylor blog post, the following couple of graphs:

And an important priviso:

Moreover, minimum wages across countries should also evaluated in the context of other government spending programs or tax provisions that benefit low-wage families.

None of this is to say what minimum wage is right or wrong, or what set of social and economic policies are right and wrong.  It is instead to note that, relative to mean and median income, NZ’s minimum wage is very high by international standards.  Make of that whatever you will – and do so in the comments if you like.

My views on the minimum wage will appear at another time – far in the future.  For now all I want to share are graphs.

Crowd funding, Trade Me and Network Externalities

Very exciting news last week that New Zealand’s first two equity crowd funding platforms have been licensed. See PledgeMe’s (henceforth PM) blog announcement here and Snowball Effect’s (henceforth SE) FB announcement here and the FMA’s announcement here.

Exactly what role crowd funded equity will play in NZ is going to be very interesting to watch:

  • Will it fill a gap in the market and mean businesses get funding that they otherwise wouldn’t have? or
  • Will it merely substitute existing funding channels but provide a ready made army of brand ambassadors for the companies that receive funding?

I imagine it will be some combination of the two, but that’s not what I want to talk about. I wanted to briefly touch on how the market structure for crowd funding platforms might evolve.

We’ve had two licensees accepted and I have read somewhere that there are another two before the FMA (plus one combined peer-to-peer lending/equity crowdfunding platform). The question I have heard a few times is whether we can sustain 5 platforms and if one will rise to the top. In this regard, I have heard TradeMe given as an example that one platform will win out.

I’m not sure this is right.

Read more