Tuesday, October 19, 2010

Pretty simple stuff really….

David Carran from Infometrics makes two simple points which show up the folly of restricting foreign ownership of land very clearly:

  1. the immediate impact of Goff like plans would be to lower the value of farmland (which is owned by NZ farmers), and,
  2. NZ immediately becomes a more risky place to invest in so the cost of capital goes up.

Every dollar lost from agriculture through such processes involves, on average, a further $1.99 in outputs from contributing industries being displaced into less valuable uses…. and 2.46 FTE jobs.

This is a high price to pay for an ephemeral “feel good”  notion based on xenophobia. And that's not even counting the benefits lost.

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