Basil Sharp

Flood Prone Risk and Amenity Values: A Spatial Hedonic Analysis

This study examines the impact of flood hazard zone location on residential property values. The study utilises data from over 2,000 private residential property sales occurred during 2006 in North Shore City, New Zealand. A spatial autoregressive hedonic model is developed to provide efficient estimates of the marginal effect of flood prone risks on property values. Our results suggest that a property located within a flood hazard zone sells for 4.3% less than an equivalent property located outside the flood hazard zone. Given the median house price, estimated discount associated with flood risks is approximately NZ

New Zealand's emissions trading scheme

22,000.

Choice experiment adaptive design benefits: a case study*

In 2008, New Zealand became the first country to introduce a comprehensive Emissions Trading Scheme that includes all sectors and all gases. While NZ can claim the high ground in the international arena, the emissions trading scheme will impose substantial economic costs and its success will hinge on the emergence of an open, viable, and liquid international carbon market. We provide an overview of NZs Emission Trading Scheme and discuss its implications for the countrys economy.

From regulated access to transferable harvesting rights: Policy insights from New Zealand

Efficient experimental designs offer the potential to reduce required sample sizes, or to reduce confidence intervals for parameters of interest, in choice experiments. Choice experiment designs have typically addressed efficiency of utility function parameter estimates. The recently developed concept of C-efficiency recognises the salience of willingness to pay estimates rather than utility function parameters in studies that seek to put money values on attributes. C-efficiency design benefits have been illustrated in a theoretical context, but have not been tested in applied settings. This study reports a choice experiment field application that used initial responses to update statistical designs to maximise C-efficiency. Consistent with theoretical predictions, the revised design delivered significant reductions in the variance of willingness to pay estimates, illustrating that C-efficient designs can indeed decrease costs of choice experiments by reducing required sample sizes.

Electricity distribution as an unsustainable natural monopoly: a potential outcome of New Zealand’s regulatory regime

The dramatic decline in yields from many of the worlds fisheries has prompted an assessment of traditional regulatory approaches to management. Transferable harvesting rights provide an alternative institutional structure in fisheries management. This paper has two aims. First, it links outcomes in the fishery with institutional structure. Second, the paper identifies several important institutional variables if a transition is to be made to from command-and-control management to tradeable rights. In particular, the transition phase must deal with the expectations that attach to the status quo structure of rights in the fishery. The papers empirical content is drawn from New Zealands experience with the introduction of transferable harvesting rights.

Evaluating off-site environmental mitigation using choice modelling*

Abstract The ongoing reform of New Zealand’s electricity supply industry has attempted to separate its potentially competitive elements from those with naturally monopolistic characteristics. Yet, some competition for distribution services is occurring, raising the question as to whether electricity distributors are natural monopolies as is typically assumed. This paper presents a simple model of a representative New Zealand distribution business, and shows that, in a true economic sense, distributors are most probably sustainable natural monopolies as expected. However, the model demonstrates that a mechanism for competition may arise because the financial principles enshrined in the Ministry of Commerce’s regulatory regime can produce unsustainable cost structures and unintentionally introduce elements of contestability into the market for distribution services.

Cost Efficiency of Dairy Farming in New Zealand: A Stochastic Frontier Analysis

Evaluation of off-site mitigation entails comparison of utility changes between two sites. Choice modelling has been used to identify community willingness to trade-off attributes for two different types of stream in New Zealand. Estimated utility functions are used to derive marginal rates of substitution and stream attribute part worths which can be used to design or evaluate both on-site and off-site mitigation policy. Latent class multinomial logit models identified classes of citizens who valued stream attributes quite differently. Significant differences in values for some attributes on different stream types imply heterogeneous mitigation ratios across environmental attributes.

Capacity and Capacity Utilization of the "Voracera" Fleet in the Strait of Gibraltar

Research on the efficiency of dairy farming in New Zealand is limited and has focused predominantly on technical efficiency. We contribute to the literature on empirical analysis by examining cost efficiency of New Zealand dairy farms. We construct simplified translog stochastic cost frontiers based on an unbalanced panel of 824 farms. Average cost efficiency is estimated at 83 percent for dairy farms in the North Island and 80 percent for farms in the South Island. Our analysis of the relationship between inefficiency and farm characteristics suggests significant associations between cost efficiency and capital intensity, livestock quality, and farm size.

Institutional arrangements for conservation on private land in New Zealand

High profitability, vessel mobility and open access resulted in an increase in total harvesting capacity in the red seabream fishery (Pagellus bogaraveo, Brünnich, 1768) during the period 1983-98. In 1998 it was evident that the fishery was overexploited and a recovery plan aimed at improving the viability of the fishery was implemented in 1999. The recovery plan was specifically targeted at the problem of overcapacity. Technical efficiency, capacity output and capacity utilization is measured during the stock recovery plan. The fishing capacity of liners located in the port of Tarifa is calculated to test the effects of this recovery plan over the period 1998-2001 using data envelopment analysis. Results of this analysis show the limited impact of the recovery plan. In particular, the results reinforce the importance of institutional structure and related incentives created when preparing and implementing recovery plans.

The value of a view: A spatial hedonic analysis

One-third of New Zealands land is protected as Crown-owned national park or reserve. Large areas of land with high conservation values remain in private ownership. In particular, many rare and valuable types of native forest, especially in lowland and coastal areas, are found only on private land. A framework for analysing the institutional arrangements for protecting conservation values on private land is outlined in terms of costs, benefits and efficiency. The choice of either public or private provision may not provide the flexibility necessary to achieve conservation objectives. Narrowly defined institutions focus on a particular subset of landowners, limiting participation by others. A more flexible and dynamic arrangement could harness the private benefits of protection across a greater diversity of landowners. This should lead to more efficient protection.