A critical analysis

On the 7th of September Rodney called the submission by Bronwyn Howell on the Telecommunications Amendment Bill as the finest submission he has ever seen presented to a select committee, and said those arguing for the confiscation of property rights need to respond to Howell’s work if they are to have any intellectual credibility.

Well the challenge has been taken up, and TUANZ and InternetNZ commissioned reviews of the submission by two expert economists. Dr John Small, of Covec is the former head of economics at Auckland University and is an expert in competition and regulatory economics. Dr Tommaso Valletti, is a professor of economics at Rome University and Imperial College, London, and until recently teaching at the London School of Economics. He is an expert in the economics of telecommunications and an advisor to Ofcom, the UK telecomms regulator, the OECD, the EU and the World Bank.

One can read the reports of Dr Small and Dr Valletti online. Here are some extracts starting with Dr Small:

Howell is clearly energetic and passionate about the subject. It may be that these admirable qualities are the root cause of the serious weaknesses in the paper. It is otherwise difficult to understand how she came to blatantly misrepresent the work of others, make statements that would not pass muster in a first year economics course, suggest that her own exceptionally weak empirical work is evidence of anything meaningful, and appear ignorant of her logical errors.

Dr Small concludes: “If I was reviewing it for an academic journal, I would recommend it be rejected.”

Dr Valletti summarises his report with:

It is shown that the literature reviewed in the Submission is very selective and far from being accepted within academia. Some of the results quoted are very controversial.

He also makes the point that many of the studies Howell relies on have not been published
in leading academic journals. This means they have not been vetted by the academic community and by referees.

It is important to note that both reviewers are only commenting on the quality of the Howell submission. They are not saying that there are not grounds on which you could criticise or critique the Government’s stocktake research, and are not necessarily advocating in favour of the Govt’s package – that was outside their remit. What they are saying is that the Howell paper is not something great reliance can be placed on,

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