How big should Australia's cities be?
Ken Henry's answer to that question actually explains a lot.
When someone asks you how many people should live in a country, how big a city should be, or how many cities a country should have, there are two ways to respond.
The first is to gather the empirical evidence, apply a theoretical framework through which to evaluate it, and produce some measurable trade-offs—basically, do some kind of cost benefit analysis to try and estimate the point at which the marginal social cost of more people might equal the marginal benefit, within the context of the specific country or city.
The second is to make a value judgement, which is what we now know former Treasury Secretary Ken Henry did at least twice during his long career in Australia's public service:
" I remember I had a conversation with Kevin Rudd shortly after he became Prime Minister in November, 2007. He said, just out of the blue, 'What do you think the sustainable population of Australia is?' At the time, the Australian population was probably about 22, 23 million. And I said, 'I don't know, about 15 million.' And he said, he said '50 million. Right. That's what I think too.' And I said, 'No, no, no, no, no. 15. One five, not five zero.'
...
The population in Sydney last year and in Melbourne, both cities, increased by 150,000. Like holy hell. I think the optimal city size, if you read the literature on this stuff, at least that written by economists, the optimal city size is somewhere around about 150,000. There's two cities, brand new cities we could have built in 12 months."
Pardon my French, but Henry is full of it. Let's start with Australia's population.
