Will Lygon Street’s spruikers have the last shout?

I imagine economics teachers have abandoned school trips to Victoria Market and are now heading with their charges to the more exciting restaurant strip of Lygon Street. Why show them something as delicate and ephemeral as “perfect” competition when just up the road they can see how markets really work in the messy and dirty real world?

The Age reported last week that a number of restaurateurs in Lygon Street have come to the belated recognition that spruiking was bad for business. In essence they have been fighting over how big their slice of the pizza is while all the time the pizza is getting smaller and smaller because of public distaste for spruiking.

As one reviewer puts it: “If there is one thing I hate, loathe, detest with every fibre of my being, it’s restaurant spruikers. I just can’t stand them…. But if a restaurant spruiker comes and tries to get me to go inside, well…. I’m sorry. For me, that’s an automatic Permanent Rejection.”.

Last Tuesday afternoon, according to The Age, “the owners of eight Italian restaurants on the eastern side of Lygon Street between Grattan and Pelham met to discuss what to do about a practice that is both tradition and millstone. The informal gathering decided unanimously to put an end to spruiking”.

This sort of agreement is usually seen as inherently unstable because there’s an incentive to cheat (I’m refraining from labelling it a cartel because there’s presumably no damage to the public interest from abandoning spruiking, so such a pejorative term seems out of order). An individual owner would do better by breaking the agreement than by abiding by it because the short term returns from cheating are greater than the long term losses from the collapse of the cartel. Read the rest of this entry »


Free download!!: transport model of NYC

According to the New York Time’s Freakonomics Blog, the Balanced Transport Analyser “is a spreadsheet that models in intricate detail the daily flow of all transit – public, private, wheeled and bipedal – in New York City”. According to Wired, “over the course of about 50 worksheets, the BTA breaks down every aspect of New York City transportation—subway revenues, traffic jams, noise pollution—in an attempt to discover which mix of tolls and surcharges would create the greatest benefit for the largest number of people”.

It calculates “how new fees and changes to existing tolls affect traffic at different times of day and calculates which costs are borne by city dwellers and which by suburbanites. It calculates how long it takes passengers to dig for change and board buses. And it allows any user to adjust dozens of different variables—from taxi surcharges to truck tolls—and measure their impact. The result is a kind of statistical SimCity, an opportunity to play God and devise the perfect traffic policy”.

The Balanced Transport Analyzer was created by Charles Komanoff. The complete model can be downloaded here.


Will cars destroy Preston Market?

The biggest threat to Preston Market is cars.

I got thinking about this after I had lunch there last Friday. As always, I was taken in by the mad rush and vitality of the place and the sense that much of it is still essentially the same as it was when it started. I was surprised to learn that it’s a relatively young institution, having only been established in 1970 (although Preston proper is considerably older – it was connected to Flinders Street by rail in the 1920s and experienced a major population boom in the 1950s).

Initially, I was wondering if the Market is vulnerable to the increasing gentrification in the area, but then I realised Victoria Market has withstood demographic changes in the inner city reasonably well. Sure, it’s pretty middle class now but the deli and meat sections at Vic Market are unsurpassed in Melbourne. So while gentrification of Preston Market will undoubtedly diminish its authenticity – and that is the vital ingredient for some customers – it will not necessarily undermine its viability.

Which brings me to the threat to the Market posed by cars – not too many cars, but too few!

I saw a flyer issued by the Market parking manager to stall holders advising of a new parking scheme. I don’t know when it commences, but rather than fine parkers who stay beyond the initial free two hour period (one hour near Aldi), the new arrangement will charge them $1 for each additional hour. How that will work financially for the parking operator is a puzzle (how will they administer it cost-effectively?), but it’s their money. Read the rest of this entry »


Why do inner city residents walk and tram to work?

More than half of all trips to work by residents of the inner city are made by walking, cycling or public transport. In fact three quarters as many residents walk and cycle as use public transport for their commute.

Why? Is it because of the higher density of the inner city?

Inner city Melbourne (photo by ExTester)

The view that density predicts more sustainable transport use is a common one. While it has some role, it is not the key force at play here. In fact there’s evidence that the population density of some parts of the inner city is not that much higher than that of the suburbs – this is because the average size of households in the inner city is relatively small compared to suburban locations.

There are also examples of higher density developments where use of public transport is quite low, for example edge cities in the US and suburban New Urbanism developments like Orenco in Portland, Oregon.

So if density isn’t the primary force driving more sustainable transport use in the inner city, what is?

Here are four plausible explanations.

The first is proximity. Inner city residents live cheek by jowl with the largest concentration of jobs in the metropolitan area – the inner city has 28% of all metropolitan Melbourne’s jobs and the CBD, despite its diminutive geographical size, has 14.5%. There is no other location in Melbourne that comes within cooee of the job density of the CBD. Read the rest of this entry »


Is Melbourne Bicycle Share all spin?

I hope I’m proven wrong but I can’t help feeling Melbourne Bicycle Share is much more about political spin than about transport.

The PR material indicates the scheme is pitched at short-distance and short-duration travellers “running an errand at lunch or going across town for a meeting or lecture”. It extends “your public transport options and makes the CBD more accessible than ever before”.

The big question to my mind is what exactly is the need that this scheme is filling? Or more precisely, what is the justification for the Government subsidy it requires?

The very idea of a CBD is that it is walkable and if the trip’s too far then travellers take public transport. In fact public transport in Melbourne’s CBD, where we have the choice of the city rail loop and a dense tram system, is pretty good by world standards. Quite simply, the CBD doesn’t need share bicycles for transport.

I can’t see a lot of sense, either, in spending public money to take off-peak passengers away from public transport – that’s the very time when the system has spare capacity and should earn extra revenue with minimal extra cost. And why subsidise walkers to ride instead?

I’m not in any event confident that Melbourne Bicycle Share is even going to work. Read the rest of this entry »


Do firms want to be in suburban centres?

We know that most jobs in Melbourne are now in the suburbs. There’s also an increasing understanding that large metropolitan areas are now generally polycentric rather than monocentric in form i.e. there are significant activity centres outside the CBD with large numbers of jobs. The strategic planning update to Melbourne 2030, Melbourne @ 5 Million, released in October 2008, explicitly acknowledged this reality.

It is clear that firms can increasingly obtain the benefits of density, such as face-to-face contact, in both inner city and suburban centres where they don’t have to carry the extra costs in rent and congestion imposed by the very high density of the CBD. The CBD’s share of metropolitan jobs has consequently fallen significantly over the last 30-40 years (it has staged a small revival since 1996, showing significant jobs growth in absolute terms, but its share of metropolitan jobs has not increased).

Tysons Corner - the archetypal edge city

Yet many studies in many countries have found that while the number of suburban and inner city activity centres is increasing, the proportion of jobs located within them is falling. In fact, around a half to two thirds of employment in US cities is scattered across the metropolitan area at relatively low densities. Inter-city and cross-country comparisons are difficult, but the evidence suggests that suburban jobs are even more scattered in Melbourne.

It seems that firms can increasingly achieve the benefits of agglomeration at a larger geographical scale than that of the CBD or suburban activity centres. The advantages of physical proximity have apparently declined to such an extent that the costs of aggregation now exceed the benefits at ever lower levels of density.

But why are firms increasingly spurning density? Read the rest of this entry »