5 ms·

I don't really get why it's such a high priority to expand the London commuter belt. Train lines may be at capacity but if more money was devolved into the nort

by deif 7y ago

I don't really get why it's such a high priority to expand the London commuter belt. Train lines may be at capacity but if more money was devolved into the northern regions so everyone doesn't have to commute to London maybe we could solve the problem in a cleaner and less costly way. But then the contractors won't get their back pockets filled.

dan-robertson 7y ago
I thought that as internet speed and quality increased, we would see more office work being dispersed across the country. More people would be able to work remotely or in small satellite offices using the internet to effectively coordinate. The role of the (London) headquarters of larger companies would be diminished. Instead it feels to me like companies have become more centralised. Regional offices are gutted (much of their work can be done over the internet from headquarters), more firms are crammed into London, all competing for the same people and this competition drives up wages (and house prices) and this encourages more people to want to work there which makes it one of the few places for companies to find talent and so on. Maybe my impression of the state and change of things is just wrong. But my theory of the change in office work due to the internet is that it let things become more centralised and that this change is the reason for various other political changes (eg rising house prices -> weird policies to help people buy houses without decreasing the sale price; pushes towards better transport infrastructure in and to London; weakening of the rural and regional economy; trains in high demand which everyone hates; ...)
- Mvandenbergh 7y ago
  Yes. The work of Ronald Coase on why businesses exist at all is more relevant than ever. Coase asked the question: "why is there such a thing as a business and why are they the size they are? Why isn't everyone an independent contractor? Conversely, why isn't the whole economy one big conglomerate". His answer is essentially transaction cost and co-ordination overhead. So logically as technology changes those, the natural size and configuration of businesses and other organisations changes. What has ended up happening is that modern communications has made it much easier to do business to business transactions over larger distances than before, which has led to centralising to a smaller number of specialist firms rather than a larger number of geographically spread firms. This has been very noticeable in areas like law as well. There was a time when a manufacturing business in the Midlands had a local accountant, local law firm, etc. Now that is all centralised in a small number of cities. This has led to a more hub-centric global economy than ever before. Now you might expect that this same effect would also encourage more remote working which would have the opposite effect on firm concentration geographically. It seems to have turned out that the effect of the same technology within firms has been less drastic. In other words, while it has led to more remote working and more part time working from home, it has not had the drastic effect of completely blowing up the nature of the team. I suspect this has something to do with human nature and with transaction cost. Basically making a b2b relationship more geographically distant has turned out to be easier than physically dispersing a team within the low transaction cost company boundary. Google does search for everyone... but Google employees are usually expected to spend at least a few days a week physically co-located with their teams. All the world's widebody aircraft engines are made by only two manufacturers... who choose to concentrate their own design operations geographically. As a result, paradoxically it seems that modern technology has led to more geographical concentration rather than less. If we want to counteract that in the UK, we need to create counterweights to London. To a certain extent that already exists for things like aerospace and high end automotive - if you were starting a new business there you'd be crazy not to do around Derby. The challenge is that in most other areas London is so dominant that its dominance becomes a self fulfilling prophecy. No idea how to do that though. The effect of transport links on all this is quite hard to predict as well. Do you end up making well connected cities and towns economic extensions of London in terms of creating employment there? (Might as well start a tech company in Birmingham if it's so close to London). Or do you just turn them into commuter communities?
  - pjc50 7y ago
    Upvoted for Coase; far more people on HN should read his work, because those questions you mention are extremely critical to explaining a lot of things. All the "gig economy" firms are practical Coasianism.
    - Mvandenbergh 7y ago
      You might be interested by the idea of "Coasian Hells" which are situations where someone has tried to set up a delivery structure that doesn't match transaction costs. Good examples: -UK rail (in practice train operators, the railway operator, and rolling stock leasing companies spend vast resources trying to charge each other for things) -Boeing's supply chain for the 787 Basically every failed outsourcing project has failed because the people designing it did not understand the implications of Coase
  - thu2111 7y ago
    So this leads to the question of why firms don't like remote work (on average) and whether that might change. My guess is it's a combination of: • Corporate videoconf systems being unbelievably atrocious and unreliable compared to consumer tech. • Ditto for standard communication tools like Outlook. • The current generation of non-tech CEOs mostly being older people who either don't actually use electronic comms much, or don't like using it. E.g. my CEO doesn't use Slack at all, even though everyone else does, and most of his email is handled by his assistant. When he does write emails they're usually just one or two lines long. • Remote work places far greater weight on reading and writing ability, areas where many people are surprisingly weak but reluctant to admit it. Physical meetings are much easier on people, both in terms of requiring less mental effort and allowing people to just zone out rather than work. The latter two have no obvious fixes. On the other hand, corporate videoconf infrastructure that doesn't suck seems like it should be easier to fix. The perennial problem of "I'm five minutes late because {the dialin was missing, didn't work, my microphone was muted, etc}" is entirely solvable with better software. Unfortunately the industry's best people all focus on consumer workloads where scaling to massive success is comparatively easy and sales-free.
    - 7y ago
TheFattestNinja 7y ago
Because you are at capacity now. Don't get me wrong, I'd love to see a smaller divide between N and S, but if you start investing heavily in the N now before it actually has a meaningful impact on people's internal economic migration/commuting patterns it's going to be at least a decade (convince companies to move there, start hiring, create a salary inflation cycle from competition, etc...) Right now, London salaries are easily 2x to 3x Manchester's for Software devs (yeah I know the average data is only 30% higher but you need to compare the top vs the top, not the aggregated data). As a Junior dev moving from Hertfordshire (which is 30mins from London....) to London meant my salary instantly doubled, while living cost only maybe increased 50% if we are conservative. That's going to take a long time to offset.
- deif 7y ago
  That doesn't really change anything with HS2 though since it'll be a decade before anyone can use the line.
_visgean 7y ago
There was an interesting argument here https://www.theguardian.com/uk-news/2020/feb/04/northern-powerhouse-rail-backers-say-hs2-vital-success https://www.theguardian.com/uk-news/2020/feb/04/northern-pow... > There are at least 100 stations across the north and Midlands that would benefit from released capacity, according to Network Rail, which owns and manages Britain’s railways.
- makomk 7y ago
  There are signs that the second, northern stage of HS2 - which is the one that might benefit the north - might never happen. It's been pushed out way into the future and our politicians are talking about reviewing it. The only part that's definitely going ahead is the first phase which serves London.
Mvandenbergh 7y ago
>>"But then the contractors won't get their back pockets filled. " Are you saying that if money was spent on Northern infrastructure instead, it somehow wouldn't go to the same contractors? Contractors are agnostic on where the infra spend is geographically.
- deif 7y ago
  No I'm just saying that HS2 seems to be more of a contractor back-pocket filler than other more meaningful projects. The amount that has gone in to build a slightly faster trainline is obscene (plus it's not actually going to be faster for most people since it's probably going to stop outside London).
  - Mvandenbergh 7y ago
    I still don't understand. Is it that you think HS2 has higher margins for contractors than other projects? Otherwise spending an equivalent amount on large infrastructure elsewhere in the country would end up benefitting exactly the same contractors.
  - sadfklsjlkjwt 7y ago
    It's not really about the speed. The N-S train lines are beyond capacity already. The most important function of HS2 is that it is another N-S line.
TorKlingberg 7y ago
I would prefer to build the lines where people actually want to go, instead where you think they should go. I don't think the contractors care where you build; they make money either way.
makomk 7y ago
It's not just the northern regions that lose out. HS2 improves rail travel into and out of London at the expense of diverting funds and resources away from improving rail travel within the commuter belt and allowing it to function as something other than housing for London workers that can't afford to live there.

by deif 7y ago

dan-robertson 7y ago

I thought that as internet speed and quality increased, we would see more office work being dispersed across the country. More people would be able to work remotely or in small satellite offices using the internet to effectively coordinate. The role of the (London) headquarters of larger companies would be diminished. Instead it feels to me like companies have become more centralised. Regional offices are gutted (much of their work can be done over the internet from headquarters), more firms are crammed into London, all competing for the same people and this competition drives up wages (and house prices) and this encourages more people to want to work there which makes it one of the few places for companies to find talent and so on. Maybe my impression of the state and change of things is just wrong. But my theory of the change in office work due to the internet is that it let things become more centralised and that this change is the reason for various other political changes (eg rising house prices -> weird policies to help people buy houses without decreasing the sale price; pushes towards better transport infrastructure in and to London; weakening of the rural and regional economy; trains in high demand which everyone hates; ...)

Mvandenbergh 7y ago
Yes. The work of Ronald Coase on why businesses exist at all is more relevant than ever. Coase asked the question: "why is there such a thing as a business and why are they the size they are? Why isn't everyone an independent contractor? Conversely, why isn't the whole economy one big conglomerate". His answer is essentially transaction cost and co-ordination overhead. So logically as technology changes those, the natural size and configuration of businesses and other organisations changes. What has ended up happening is that modern communications has made it much easier to do business to business transactions over larger distances than before, which has led to centralising to a smaller number of specialist firms rather than a larger number of geographically spread firms. This has been very noticeable in areas like law as well. There was a time when a manufacturing business in the Midlands had a local accountant, local law firm, etc. Now that is all centralised in a small number of cities. This has led to a more hub-centric global economy than ever before. Now you might expect that this same effect would also encourage more remote working which would have the opposite effect on firm concentration geographically. It seems to have turned out that the effect of the same technology within firms has been less drastic. In other words, while it has led to more remote working and more part time working from home, it has not had the drastic effect of completely blowing up the nature of the team. I suspect this has something to do with human nature and with transaction cost. Basically making a b2b relationship more geographically distant has turned out to be easier than physically dispersing a team within the low transaction cost company boundary. Google does search for everyone... but Google employees are usually expected to spend at least a few days a week physically co-located with their teams. All the world's widebody aircraft engines are made by only two manufacturers... who choose to concentrate their own design operations geographically. As a result, paradoxically it seems that modern technology has led to more geographical concentration rather than less. If we want to counteract that in the UK, we need to create counterweights to London. To a certain extent that already exists for things like aerospace and high end automotive - if you were starting a new business there you'd be crazy not to do around Derby. The challenge is that in most other areas London is so dominant that its dominance becomes a self fulfilling prophecy. No idea how to do that though. The effect of transport links on all this is quite hard to predict as well. Do you end up making well connected cities and towns economic extensions of London in terms of creating employment there? (Might as well start a tech company in Birmingham if it's so close to London). Or do you just turn them into commuter communities?
- pjc50 7y ago
  Upvoted for Coase; far more people on HN should read his work, because those questions you mention are extremely critical to explaining a lot of things. All the "gig economy" firms are practical Coasianism.
  - Mvandenbergh 7y ago
    You might be interested by the idea of "Coasian Hells" which are situations where someone has tried to set up a delivery structure that doesn't match transaction costs. Good examples: -UK rail (in practice train operators, the railway operator, and rolling stock leasing companies spend vast resources trying to charge each other for things) -Boeing's supply chain for the 787 Basically every failed outsourcing project has failed because the people designing it did not understand the implications of Coase
- thu2111 7y ago
  So this leads to the question of why firms don't like remote work (on average) and whether that might change. My guess is it's a combination of: • Corporate videoconf systems being unbelievably atrocious and unreliable compared to consumer tech. • Ditto for standard communication tools like Outlook. • The current generation of non-tech CEOs mostly being older people who either don't actually use electronic comms much, or don't like using it. E.g. my CEO doesn't use Slack at all, even though everyone else does, and most of his email is handled by his assistant. When he does write emails they're usually just one or two lines long. • Remote work places far greater weight on reading and writing ability, areas where many people are surprisingly weak but reluctant to admit it. Physical meetings are much easier on people, both in terms of requiring less mental effort and allowing people to just zone out rather than work. The latter two have no obvious fixes. On the other hand, corporate videoconf infrastructure that doesn't suck seems like it should be easier to fix. The perennial problem of "I'm five minutes late because {the dialin was missing, didn't work, my microphone was muted, etc}" is entirely solvable with better software. Unfortunately the industry's best people all focus on consumer workloads where scaling to massive success is comparatively easy and sales-free.
  - 7y ago

TheFattestNinja 7y ago

Because you are at capacity now. Don't get me wrong, I'd love to see a smaller divide between N and S, but if you start investing heavily in the N now before it actually has a meaningful impact on people's internal economic migration/commuting patterns it's going to be at least a decade (convince companies to move there, start hiring, create a salary inflation cycle from competition, etc...) Right now, London salaries are easily 2x to 3x Manchester's for Software devs (yeah I know the average data is only 30% higher but you need to compare the top vs the top, not the aggregated data). As a Junior dev moving from Hertfordshire (which is 30mins from London....) to London meant my salary instantly doubled, while living cost only maybe increased 50% if we are conservative. That's going to take a long time to offset.

deif 7y ago
That doesn't really change anything with HS2 though since it'll be a decade before anyone can use the line.

_visgean 7y ago

There was an interesting argument here https://www.theguardian.com/uk-news/2020/feb/04/northern-powerhouse-rail-backers-say-hs2-vital-success https://www.theguardian.com/uk-news/2020/feb/04/northern-pow... > There are at least 100 stations across the north and Midlands that would benefit from released capacity, according to Network Rail, which owns and manages Britain’s railways.

makomk 7y ago
There are signs that the second, northern stage of HS2 - which is the one that might benefit the north - might never happen. It's been pushed out way into the future and our politicians are talking about reviewing it. The only part that's definitely going ahead is the first phase which serves London.

Mvandenbergh 7y ago

>>"But then the contractors won't get their back pockets filled. " Are you saying that if money was spent on Northern infrastructure instead, it somehow wouldn't go to the same contractors? Contractors are agnostic on where the infra spend is geographically.

deif 7y ago
No I'm just saying that HS2 seems to be more of a contractor back-pocket filler than other more meaningful projects. The amount that has gone in to build a slightly faster trainline is obscene (plus it's not actually going to be faster for most people since it's probably going to stop outside London).
- Mvandenbergh 7y ago
  I still don't understand. Is it that you think HS2 has higher margins for contractors than other projects? Otherwise spending an equivalent amount on large infrastructure elsewhere in the country would end up benefitting exactly the same contractors.
- sadfklsjlkjwt 7y ago
  It's not really about the speed. The N-S train lines are beyond capacity already. The most important function of HS2 is that it is another N-S line.

TorKlingberg 7y ago

I would prefer to build the lines where people actually want to go, instead where you think they should go. I don't think the contractors care where you build; they make money either way.

makomk 7y ago

It's not just the northern regions that lose out. HS2 improves rail travel into and out of London at the expense of diverting funds and resources away from improving rail travel within the commuter belt and allowing it to function as something other than housing for London workers that can't afford to live there.