ProdComm Update: May 2016


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The Productivity Commission – Five years on

New Zealand illustration with productivity themesThe Productivity Commission was founded in April 2011, and has just celebrated its fifth birthday. Since establishment, the Commission has completed eight inquiries, starting with housing affordability and international freight transport costs, and on through such varied topics as strengthening economic relations between Australia and New Zealand, local government regulation, regulatory institutions and practices, the services sector, social services and using land for housing.

The ninth and tenth inquiries, on new models of tertiary education and better urban planning are well underway. The Government has responded to five inquiries to date and the recommendations are being adopted or implemented in various areas. 
As well as the inquiry work, the Commission has published 21 research papers, on topics such as firm dynamics and job creation, labour income share in New Zealand, the price of goods and services, international trade in services, and major pieces of work looking at New Zealand’s productivity to date and why New Zealand lags behind other countries.

The Commission is now developing a paper outlining the policy considerations necessary in lifting New Zealand’s long-run rate of productivity growth, supported by other work in innovation, reallocation & employment dynamics, economic geography, and public sector productivity.

The Commission has also worked with other government partners to establish the Productivity Hub, which coordinates research contributing to building up a big picture of New Zealand’s productivity performance and how this can be improved.

What can the Productivity Commission add to a 1000-year old institution?

This was the question that Murray Sherwin asked at a recent lecture at the University of Canterbury, talking about the inquiry into new models of tertiary education.
Recent developments in technology, internationalisation, population, tuition costs and demand for skills may transform tertiary education. The Commission is bringing its evidence-based analysis and broad consultation approach to look at the system as a whole and what might drive or hinder innovation.

The Commission has received over 80 submissions on the issues paper, which are now available online. The draft report will be published in September/October, and there will be an opportunity to provide feedback on the draft recommendations before the final report is delivered to the Government on 28 February 2017.

What can complexity theory tell us about urban planning?

Learning how to effectively govern within complex systems is essential to well-performing cities. The urban planning inquiry has released a research note to generate discussion about cities as complex, adaptive systems and the possible implications for urban planning.

It raises questions about the place of different broad approaches to planning in dealing with complexity, and how collective choice mechanisms to support a participative, collaborative approach might develop.

Complexity theory is only one frame that the inquiry will use, alongside urban economics, the economics of innovation, behavioural economics and comparative institutional analysis.

The inquiry has received 52 submissions and continues to analyse these, and discussions with different groups around the country, before the draft report is released in August.

Productivity symposium on innovation: Read all about it

Self-driving cars, universal programmable robots, data-driven expert systems, and the Internet of Things are no longer just the subject of science fiction.

At the December symposium on “Growing more innovative and productive Kiwi firms”, Eric Bartelsman said “ICT-led innovation has a long way to run and will put a premium on nimble entrepreneurship, labour-market flexibility, re-training and resource reallocation.”

Paul Conway looks at how well New Zealand is positioned to benefit from these technologies, and the transcript of the event is now available.

Making social services work for everyone

Users of social services will have different needs and also differing abilities to negotiate various services. This is particularly important for clients with multiple, complex needs who may not be able to access the services that are best suited for them.

The Commission examined this issue and outlines two possible solutions in an article for Policy Quarterly magazine.

What’s new in productivity

Upcoming events

17 May: Are we there yet? Five years on the road to addressing child poverty (Productivity Hub event)
17-18 May: Energy Management Association conference - Paul Conway will talk about why NZ’s overall productivity is so difficult to lift and what will help.
26 May: Make a Difference with Economics Awards – student competition
22-23 July: Tertiary Education Union Symposium - Voices from tertiary education

About us

The Commission is an independent Crown entity. We undertake in-depth inquiries on topics referred to us by the Government (our core business), carry out productivity-related research that assists improvement in productivity over time and promote understanding of productivity issues.