The Economist Intelligence Unit’s (EIU) 2011 Global Liveability Report says Melbourne is the 2nd most liveable city in the world, just behind Vancouver and up one place from 3rd last year. Sydney ranks 7th.

But any elation is likely to be short-lived. The Mercer Annual Quality of Living survey for 2011, due in late May, will very probably put Melbourne much further down the list. In Mercer’s 2009 and 2010 surveys, Melbourne slipped from 17th place to 18th place. Sydney ranked 10th in both years.

As I’ve pointed out before, these sorts of surveys shouldn’t be taken seriously as a guide to how liveable our cities really are. They have a number of shortcomings.

First, they’ve been criticised for lack of transparency about their methodologies, definitions and quality of data.

Second, they are designed to assist companies determine living allowances for staff posted to an overseas destination. They aren’t intended to measure the quality of life for permanent residents, who have very different requirements to those of highly renumerated, short-term executives. Not surprisingly, some Melburnites Melburnians don’t seem to believe that Melbourne is as good as the EIU makes out – see the comments on this story in the Sun-Herald.

Third, these sorts of surveys are also of limited value in making intra-country comparisons. They give a high weighting to variables that reflect national characteristics rather than city-specific characteristics, so their ability to discriminate between places in the same country isn’t high.

For example, all Australia’s capitals tend to rank highly simply because Australia ranks well on a host of essentially national characteristics like stability, education and health care. For example, the EIU’s report has Melbourne on 97.5%, Sydney on 96.1% and Perth and Adelaide equal on 95.9%.

Finally, the international rankings are pretty meaningless anyway, at least at the top. The difference in scores between top ranking Vancouver and 10th ranked Auckland is very small – 98% and 95.7% respectively.

While it also has methodological limitations, at least the Property Council of Australia’s assessment of the liveability of Australia’s capitals is based on the expectations of permanent residents. Adelaide ranks 1st and Melbourne 3rd. Sydney ranks last.