Great Cities Have Great Networks
The Right to the City is a concept and slogan that emphasises the idea that urban spaces should be inclusive, democratic, and accessible to all residents. The idea was first articulated by French philosopher Henri Lefebvre in his 1968 book Le Droit à la Ville.
New Zealand is having one of its periodic episodes where anti-apartment NIMBYs and anti-sprawling planners talk past each other. Generation Rent are likely to be collateral damage in this clash. Is there a better way? Yes, learn from great cities.
When I wrote my last paper — New Zealand’s Addiction to Land Speculation is its Forever Weakness — I stated it was possible there could be a backlash against pro-housing land-use reforms. To a degree that has happened, with a National party MP celebrating successfully lobbying to stop houses being built in his city electorate by undermining a bipartisan political agreement between National and Labour that would have enabled over 100,000 additional houses to be built in New Zealand’s major (tier 1) cities.
This is unfortunate because academic research has found quantitative evidence that the earlier Auckland Unitary Plan up-zoning has protected Auckland families from significantly higher rents, so the loss of planning certainty around up-zoning is a setback for addressing the housing component of the cost-of-living crisis.
The National party is clearly divided on this issue as its housing spokesperson Chris Bishop in recent interviews remains supportive of pro-housing land-use reforms (Q+A and Bernard Hickey’s podcast interview titled — How big does Chris Bishop want us to be?).
In other parts of New Zealand local homeowners have also successfully lobbied to exclude intensive housing for low-income earners being built in their area.
I could go into the details of these and other similar anti-house building events, but they have been well covered by the media and quite frankly they are a bit depressing. Instead of looking at the ‘bad’ I think it is helpful to look at what ‘good’ could be like.
What do great cities look like? What lessons can we learn? In what context are they being built?
All around the world for several centuries people have been moving from low density rural environments to higher density urban areas. This is not a result of a top-down policy prescription — it is the cumulative result of individual choice. Cities have a concentration of networks that rural areas lack — it is probably this factor which people are responding to.
Cities have numerous different types of networks.
Some physical — like the systems that provide residents with fresh water, remove sewer water, manage flood waters, provide public transport and roads.
Some social — like business networking meetings, hobby groups, sporting competitions, church groups, family and friend support networks.
There are networks that share knowledge — both formally, with institutions such as schools and universities, and informally, such as the café society of renaissance Europe.
Cities have large networks that better match labour skills to speciality tasks, give better recreational opportunities, and provide a greater variety of shopping choice. Some options like dating apps are not commonly thought of as networks yet have a strong location-based network effect.
Most of these networks are beneficial to cities (exceptions, such as the easier spread of communicable diseases or city destroying fires have mostly been mitigated away).
The benefits of networks can sometimes be measured quantitatively. Economists have calculated that cities typically get more productive as they grow in population size, and workers get more productive the more jobs they can access in a reasonable commuting time. Beneficial city network effects are called agglomeration by economists.
I would contend that cities have a ‘pull’ factor that is driving the growth of fewer, larger cities rather than there being a ‘push’ factor away from rural living which would result in the growth of many more, smaller rurally located townships.
The major constraint preventing city networks from becoming ever more concentrated — for stopping the theoretical possibility of there being one mega-city — is the need for the city to be located in a physical space. In other words, real-estate and travel speed are the major constraints that counteract the attractive agglomeration benefits of cities.
Historically the distance across an urban area was about one hours walk. This is because a rule of thumb that has been found to be true across different geographies, different travel modes, different cultures and historical time periods is people give themselves on average one hour for their daily travel budget — and very few people travel more than two hours a day.
The Infrastructure Commission made the following comment about their above graph.
“Rising travel speeds between the 1930s and 1970s facilitated housing supply by increasing the area where new homes could be built. Auckland’s built-up area expanded rapidly during this period. When growth in travel speeds slowed in the 1970s and then began to reverse in the 1990s, urban expansion also slowed down as it became harder to build at the edge of the city. It will be difficult to reverse the decline in travel speeds through investment, as new road capacity tends to ‘induce’ additional driving, resulting in few sustained benefits for travel speed. A potential approach would be to use a combination of congestion pricing, to mitigate severe congestion and widespread, low-cost deployment of new transport options to lift mobility.” Source — The decline of housing supply in New Zealand: Why it happened and how to reverse it — March 2022
When cities exceed the development capacity of its real estate, when demand for city life exceeds supply, then privately owned land and/or the publicly owned right-of-way corridors come under pressure. This results in either rapidly escalating prices for private property and/or increasing congestion of public spaces — traffic jams on roads etc.
In the past there have been some quite extreme mechanisms to manage excessive demand for street space.
Mechanisms are needed that ensures the development capacity of a city’s real estate is such that it can respond to demand. This includes the demand of all newcomers — not just the wealthy like this link to an article on luxury condos clearly explains.
Given the vast majority of people — over 80% of people worldwide — are either currently living in urban environments or in the coming generations will move to urban areas it is important that these mechanisms genuinely do provide enough developmental capacity*.
Great cities have a greater variety and greater quality of beneficial networks. Not only that, great cities have inclusive networks. Newcomers and the next generation are able to find a place in city networks that provides them with the best opportunities.
What mechanisms have great cities used? Primarily great cities are the result of very long-term spatial planning tools (mostly 50 years plus) that provide ‘up and out’ developmental opportunities that has allowed supply to keep ahead of demand. Crucially, in addition to providing private property development capacity these spatial planning policies designated high quality public right-of-way corridors before the land area was overbuilt (see this video on Making Room for Urban Expansion). This lowers infrastructure costs and allows these corridors to be upgraded to higher capacity modes of travel when demand warrants it. For instance, Manhattan’s wide grid street network which was designated in 1811 made it easier to construct cut and cover subway tunnels along these corridors in the 20th century.
Even solidly libertarian free market economists such as Eric Crampton understand the importance designating public right-of-ways corridors in advance of development, which he articulated well in an article titled Lack of paper roads hampers urban growth. Describing how on the back of his old family farm in Canada there was a 30m wide paper road because every mile both north and south and east and west these road corridors were designated in 1870. This system facilitated the growth of great north American cities like Toronto.
It is common in New Zealand for policy makers to rightly point out the benefits that overseas cities have achieved from having higher density — in particular lower per capita transport energy use. It is part of the rationale for the Greater Christchurch Public Transport Futures Mass Rapid Transit Indicative Business Case for instance.
Urban Density and Energy Consumption
But this thinking can become problematic when it is assumed these overseas cities achieved their higher densities by stopping outward expansion to force the city to grow up — which is not what happened. Yet there are a group of New Zealand planners and people in the wider public who believe this approach is self-evident, common sense even. They believe that allowing any outward expansion will reduce density. Implicitly they believe that cities respond best to the ‘stick’. For example the Greater Christchurch spatial plan in its latest draft makes the argument for urban growth boundaries to prevent outward expansion and has followed through with this thinking by not designating any public right-of-way corridors outside of the existing urban footprint.
Building out from a city can be desirable because of lower land costs. The New Zealand Infrastructure Commission found between 2010 and 2021, nearly every large New Zealand city experienced significant increases in the value of urban land relative to nearby rural land. For instance, in 2010, Auckland’s urban land values were 2.1 times higher than the value of adjacent rural land. By 2021, this ratio had risen to 4.4.
Land prices in inner areas are less likely to escalate rapidly when potential new developments at the fringes provide options, including well-designed greenfield transit-oriented development. Without such options, it is too easy for any improvements in a city’s desirability, or for productivity increases in the urban area, to simply lead to land price increases that benefit existing landowners rather than residents and potential residents more broadly (A New Approach to Urban Planning, 2021, P.9)
Successful high density overseas cities were not the product of a ‘stick’ approach, that could unnecessarily escalate urban land prices which would degrade the attractiveness of the city, resulting in less higher density houses being built within the city’s urban footprint. Case study analysis in the paper A New Approach to Urban Planning indicates great cities have well established planning policies that enable both up and out urban development.
A well-designed transit-oriented development outside a city’s urban footprint will have better energy use credentials compared to poorly designed infill housing within a city. For example, this rail suburb built outside of Tokyo using land readjustment infrastructure funding financing will be more energy efficient compared to an infill development in a typical New Zealand city suburb.
It is notable that a 10% increase in citywide average population density only leads to a roughly 0.6% reduction in vehicle travel (A New Approach to Urban Planning, 2021, P.12). As shown in the above table, cities that have adopted a regional spatial planning type approach have achieved significantly larger emission reductions. Successful cities use a ‘carrot’ approach of working with not against network effects. In particular they price newcomers in not out.
Copenhagen is a good example of working with the network effect. Planners back in 1947 understood growth would occur on expansive transport corridor fingers (initially five lines of passenger trains with a total of 170km of track) but where these lines connected in the palm of the hand there would be a concentrated network effect which would drive even greater density growth.
At the long-term regional spatial plan level, it is important to keep an open mind, to be expansive to the possibilities of how cities will move forward. For instance, it is not necessary to choose the fingers or the palm — both should be enabled. The resulting regional plan should reflect this open-minded thinking. Long-term this will give the most choices and the best outcomes. When specific projects are being decided upon is the time to weigh up the individual costs, and other important outcomes, such as CO2 emissions and so on.
Unfortunately, the Anglosphere countries have not built at the same rate as other countries, in particular because they have under-supplied higher density apartment living options. See the podcast titled — Apartment Living Cures Housing Viruses — for the full explanation, but the short version is the sort of positive network effect that the likes of Copenhagen and Tokyo experience has been inhibited in Anglosphere countries.
There seems to be some sort of cultural backlash against apartments — perhaps too much scarring from a failed attempt at densification post-WW2 with high-rise social housing towers. Although it could be a historic attitude “that values the privacy of one’s own home — most easily achieved in low-rise, single-family housing. The phrase ‘an Englishman’s home is his castle’ dates back several centuries” (The Anglosphere needs to learn to love apartment living).
Maybe New Zealand needs more people who have experienced attractive mid-rise apartment living overseas to clarify it has many advantages and is not the dystopian nightmare that some fear.
The cultural backlash against higher density housing which New Zealand is experiencing threatens to inhibit the ability for cities to build up which directly clashes with New Zealand planners, such as Timothy Welch insisting that cities cannot plan to build out, that urban growth boundaries must be imposed. Future generations — ‘generation rent’ as some have labeled young New Zealanders who seek their right to the city are likely to be collateral damage in this clash. Surely there is a better way forward — overseas cities have become great — what have they done?
What lessons do great cities provide?
Clearly long-term planning that ensures a plentiful supply of both developable private land and public land for lower cost infrastructure corridors is important. Excessive demand and insufficient supply for city real estate — both private land and public street spaces — leads to congestion and escalating land prices which inhibits the inclusivity of city networks. This process does though hint at infrastructure funding tools that could help cities pay for the infrastructure needed to increase developmental capacity and enable city networks to be more inclusive.
The English-speaking world needs to get over its irrational fear of apartments — especially the attractive human scale mid-level buildings that are commonly found in Europe and Asia. Providing greater choice in housing typologies is a good thing because it meets the needs of a greater variety of people — it is including not excluding.
Overall, it is most important that city networks are inclusive — great networks are how cities become great. Cities should ensure there is affordable access to as many beneficial network opportunities as possible. This will cater for the greatest number of people in a way that best suits their differing life situations and preferences.
Finally, city-based networks respond best to a light touch, more not less choice, a ‘carrot’ not the ‘stick’ approach that works with not against positive network effects.
Often my articles are republished on the Interest.co.nz website which allows comments from the wider public. One commentator who uses the moniker — Powerdownkiwi (PDK) argues that long-term growth is not possible and shouldn’t be planned for because of its exponential nature leads to over exploitation of resources which inevitably causes a Malthusian population collapse (PDK is particularly worried that fossil fuel use is a society supporting energy bonus that cannot be replaced).
I would like to pre-emptively counter PDK that technology has allowed humanity to experience a sigmoidal growth curve to a higher stabilised population level and I am reasonably confident that ‘necessity being the driver of innovation’ will allow humanity to maintain this stabilised level — see the video Beyond Malthus and Boserup for the full explanation.
Further, New Zealand cities in the future might not grow because of global economic growth but because of the global movement of peoples in response to climate change. For example, later on in the century Southland might have a very desirable climate in a much warmer world and it is possible Invercargill could have a golden-age. It is hard to know if this is likely, but it is certainly not inconceivable. Having city plans that can cope with different growth scenarios — such as Auckland’s population doubling by 2073 — is a contingency that policy makers should take seriously.
