Uneven Roads: Addressing the Inconsistencies in Local Road Valuation Across New Zealand

This article identifies and evaluates possible methodologies for estimating the capital value of New Zealand’s local road network. Local councils and central government agencies could use the findings to address the current inconsistencies in valuation approaches and enable better-informed decision-making for local road investment, maintenance, and user charges. The outputs will improve our understanding of the socio-economic and financial costs of providing and using the New Zealand transport system. The article discusses that the commonly used accounting-based valuation methods underestimate roads’ (economic) value. Suppose the purpose of a valuation is to prioritise investment. In that case, an accounting-based approach prioritises costlier road linkages instead of those with the highest economic value.

Emission Reduction Initiatives

As part of global efforts to limit warming to 1.5°C, most countries, including New Zealand, have ambitious climate emission reduction targets. In New Zealand, the Climate Change Response Act (2002) requires all greenhouse gases to reach net zero by 2050. The current report provides detail on the identified transport policy levers to reduce emissions. In a parallel work, Waka Kotahi NZ Transport Agency commissioned Principal Economics to undertake research to assess how and to what extent generalised cost between private vehicles and public transport/active modes needs to change for mode shift to occur in New Zealand’s three largest urban areas.

The four categories of emission reduction policies identified are non-auto travel options, programmes for trip reduction, land use policies that reduce car travel demand, and policies that apply pricing.  Our Emission Reduction Iniatives (ERI) knowledge hub provides a description for each policy, the type of travel it affects, the method for measuring each policy’s travel and emission effects, its secondary impacts and other available information. Other lists and summaries are available at SuM4all (2019), ITF (2022), Transportation for America & Smart Growth America (2020), VTPI (2020), Byars et al. (2017), California Air Resources Board (2014), International Energy Agency (n.d.). Summaries with Australian or New Zealand context discussed include Wallis (2016) and Carran-Fletcher et al. (2020).

The identified policies overlap and interact in various ways. Many have synergistic effects – they are more effective if implemented together. Some compete; for example, ride-hailing may attract travellers who would otherwise use cycles or public transport. As a result, these policies are generally more effective when developed as an integrated programme that includes the optimal combination of strategies that maximises benefits and minimises problems.

Cite this article

Principal Economics. (2023). Emission Reduction Initiatives Knowledge Hub. Report to Waka Kotahi New Zealand Transport Agency.

Great decisions are timely: Benefits from more efficient infrastructure investment decision-making

Aotearoa New Zealand suffers from an infrastructure deficit. Without the key infrastructure needed now for our economy to thrive, we deprive future generations from significant economic prosperity. While transformational infrastructure projects necessitate time to be developed into sound technical solutions to our needs, many New Zealand projects are further delayed by policy decision and financing constraints.
In this novel application of the infrastructure Wider Economic Benefits approach, we quantify the cost to society of these further delays for the first time, by using the example of the Waikato Expressway. We used our subregional CGE model to estimate the downstream benefits of the Expressway. At a high-level, results of our analysis quantify the annual benefits of having the Waikato Expressway in the economy. Without the expressway in function as early as possible, $334 million of economic benefits were forgone each year.

Cite this article

Principal Economics. (2022). Great decisions are timely: Benefits from more efficient
infrastructure investment decision-making. Report to Infrastructure New Zealand.

Climate change adaptation and investment decision making

Avoid costly delays in decision-making. For deep uncertainty, plan ahead, start small, and keep monitoring. Climate is beginning to exacerbate extreme “one-in-100-year” events. Our knowledge of the likelihood of these large-impact events happening in shorter intervals is limited. Adaptive Decision-Making can help to minimise the cost (from delays) to the economy through increasing flexibility at the planning phase. Our earlier work estimated the annual cost of delay to be equal to 18 per cent of the capital cost of projects.

Cite this article

Principal Economics. (2023). Climate change adaptation and investment decision making. Waka Kotahi NZ Transport Agency.

Business Development Capacity Assessment for Dunedin City

Dunedin City Council appointed Principal Economics to provide a comprehensive assessment of the sufficiency in development capacity of business land within Dunedin to fulfils requirements of the the National Policy Statement on Urban Development (NPS-UD 2020), including an investigation of:

In our assessment of demand and sufficiency we identified existing businesses across New Zealand and their locational attributes including but not limited to land size, shape, access, reverse sensitivities and other market-based factors. We use industries’ revealed preferences to assess the features of land that they have determined as being suitable. This was then matched with the supply of business land in Dunedin City after applying a range of spatial analysis techniques.