In an opinion piece in the New Zealand Herald today, Thomas Bywater wrote:
The annual “bun fight” for bunks on the Milford and Routeburn tracks has become something of a tradition. Thousands of hopefuls log-in on opening day to try and book one of the 120 bunks on the “finest walks” in the world. Since moving to the online booking system, it’s become a bit of a lottery...
Many put the blame squarely on DoC for ruining their tramping holiday. Particularly international walkers, who said they had stayed up into the small hours of the morning to try and secure a place.
Bywater's solution to the problem is to create more Great Walks:
The only way to increase the number of bunks on the Great Walk network is to increase the number of Great Walks.
It’s a solution that the Department has only recently reached, with the addition of the Paparoa in 2019. As the fourth most well-subscribed trail on the network the West Coast trail has been a huge success.
That is only one way, not the only way, to improve things. Another is to recognise that, when there are more people wanting to buy a good or service than there is capacity to provide it, that means that there is excess demand for the good or service. Excess demand arises when the price is below the equilibrium price (the price that would equate the quantity demanded and quantity supplied of the good or service). This situation is shown in the diagram below. At the current market price for the Great Walks of P0, the quantity of huts demanded is QD, while the quantity of huts supplied (available) is QS. Since QD is greater than QS, there is excess demand (a shortage).
How do you get rid of excess demand? You allow the price to increase. If the price was P1 instead of P0, then both the quantity of huts demanded and the quantity of huts supplied would be Q1. There would be no more excess demand. Every tramper who was willing to pay P1 for a hut would get one. This is a point that I have made before (in relation to the free pricing of the Great Walks, rather than the price of huts). There are no good options for managing excess demand - either the price needs to increase, or some people are going to miss out.
Building new Great Walks is a great idea in its own right. However, it will only impact demand for the Routeburn or Milford Tracks to the extent that the new Great Walk is a substitute. That the Paparoa Track quickly because the 'fourth most well-subscribed trail' and yet we still have serious excess demand for other Great Walks doesn't provide a strong endorsement of new tracks as a solution. Instead, it is more likely that the addition of new tracks simply adds new demand to the system as well as new supply.
On the plus side, I was happy to see this bit from Bywater's article:
For the first time since the pandemic, international visitors were able to vie for a place, albeit at a higher rate than domestic visitors. From those that were able to book a place on the Milford Track, last week, 35 per cent were from overseas.
Finally, we have price discrimination that favours domestic tourists over international tourists (as I have argued for before - see here and here). Now, we just need the prices (for both domestic and international trampers) to rise some more.
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