The political battle for middle class voters in many Anglo-world countries is moving onto the housing front. Many different urbanisation models are being considered. Tokyo in particular is gaining a lot of attention.
Liz Truss a UK Conservative junior Minister is a big fan of Tokyo urbanism as a post-Brexit/post-austerity remedy for her country’s housing woes and as a campaign strategy for her party to gain political support with young voters. She believes the Conservative party needs to challenge vested interests, in particular NIMBY land owners who oppose new housing. Truss is aware that the increase in Piketty inequality is due to excessive house price inflation. She proposes land use policy reform.
It is refreshing to listen to a debate about how society can become more productive not more speculative. And to listen to politicians who want to be principled not populist. At the moment in the Anglo-world we have speculative societies being led by popularity contests which is a dangerous mix.
Below is my understanding of the key aspects of Japanese urbanism and how it may apply to my Anglo-world country of New Zealand.
1. The way Tokyo has integrated trains with property development is brilliant.
2. Unmatchable in their efficiency, reliability and speed, Japanese trains represent the bleeding edge of innovative modern transport.
3. An important aspect of rails success in Japan is their excellent service culture. There is a holistic consideration of all aspects of service from facilitating affordable housing, fast and speedy journeys that take advantage of the latest technology, to supporting an ecosystem of high quality commercial enterprises at destinations.
4. Public transport in Tokyo does not need to be subsidised because Japan does not spatially subsidise motor cars. In Japan when you purchase a vehicle you must prove that you own or rent a private parking space suitable for the vehicle. There is no assumption that motorists have the right to store their vehicle in public spaces for free. Scarce city spaces are allocated by pricing.
5. Even though Tokyo is the largest city in the world it has surprisingly affordable housing. It seems that competitive transport mechanisms combined with competitive urban housing intensification characteristics has allowed Tokyo to be a relatively affordable city.
6. New Zealand transport economist David Lupton has a thesis which I believe gives the theoretical backing for why Tokyo urbanism works so well. David believes we need appropriate charges for infrastructure and services so the choices people make do not impose financial burdens on others.
7. Urbanist Alain Bertaud in his new book ‘Order Without Design -How Markets Shape Cities’ confirms this theoretical approach.
Congestion road pricing (P.200)
8. These sort of spatial economic ideas I amalgamated into a Successful cities understand spatial economics paper.
9. Interestingly, Japan copied Germany’s land readjustment practices to make room for urban expansion.
10. I believe land readjustment is one of the factors that the boss of New Zealand’s Kiwibuild scheme (building 100,000 affordable houses over 10 years) should be aware of to make Kiwibuild successful. Kiwibuild’s task should be building affordable medium density housing around rapid transport so that coherent charging for city spaces policies can be introduced at a later stage of urbanisation reforms without it being an undue burden on low and middle income earners.
11. New Zealand and the United Kingdom have unexplained productivity gaps. Economists argue that larger cities are more productive than smaller cities, and become more productive as they grow due to something called “agglomeration benefits”. This simple law seems to hold well in economies like the USA, Germany, France, and the Netherlands. For example, Lyon, the second largest city in France, is more productive than Marseille, the third largest city, which is in turn more productive than Lille. This pattern is not true for the UK. Productivity in it’s larger cities has not significantly improved from increasing in size, especially once London is excluded. It is argued that a lack of rapid transit catering for peak periods, when the agglomeration effect is at its most powerful, means that many large UK cities are actually much smaller than their population sizes would indicate.
12. New Zealand towns and cities may also have smaller populations than they could due to high housing costs being a barrier of entry into productive metropolitan labour markets. Economist Peter Nunns who is the partner of Green MP and Associate Transport Minister -Julie Anne Genter has modeled the size of this effect. Peter looked at scenarios where housing in New Zealand was more abundant and in which we’d avoided scarcity-driven price increases over the last generation. When Peter extended the model to include New Zealanders working in Australia, he found large effects on population distribution and economic performance. Making housing abundant throughout New Zealand could have reduced outflows to Australia by 50 to 100 percent.