New Zealand is again having to reconcile conflicting pressures from its military and its trade interests. Should we join Pillar Two of AUKUS and risk compromising our markets in China? For a century after New Zealand was founded in 1840, its external security arrangements and external economics arrangements were aligned. Britain, then the international hegemon,…
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Whether Britain leaving the European Union was right or wrong, good or bad is for the Brits to decide. But there are lessons about international trade to be learned from Brexit, especially as it is very unusual for an economy to break so completely from its major training partner. In Econ101 we are taught Ricardo’s…
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In his Economists in the Cold War, Alan Bollard contrasts Saburo Okita of Japan with Zhou En Lai of China to highlight a critical issue. Saburo Okita (1914-1993) was in Manchuria (northeast China), in the port city of Darien (Chinese: Dalien) which was occupied by Japan at that time. Because they were politically unsympathetic to…
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Singapore and New Zealand have much the same population – a bit over five million people. They are both affluent economies – Singapore is more affluent than New Zealand although there are reasons to believe the data exaggerates the differences. Because of their resource base and location they have rather different economic structures. Yet the…
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Evergrande and Country Garden – two giant Chinese property development companies – are a portent of the turbulence before us. The recent financial failures of two ginormous Chinese property companies, Evergrande and Country Garden, at various times ranked the second largest and sixth largest in China have implications for the New Zealand economy. The Evergrande…
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I was asked by a Spanish journalist the following two questions (particular with attention to a historical perspective): How likely do you see (if at all) a transition from an economy based on primary products towards an economy where digital services exports might play an important part? I would also like to ask about the…
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Whatever the damage, especially to the British economy, Brexit has done us a service by illustrating the complexity of trade. Brexit is the only example we have of two closely integrated sophisticated economies severing trading ties. The European Union and Britain still do not have tariffs or import quotas between them – the stuff of…
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Does the US need to strike a grand bargain with like-minded countries to pool their efforts? What does this tell us about today’s global politics? Perhaps the most remarkable editorial of last year was the cover leader of the London Economist on 19 November 2020. Shortly after Joe Biden was elected president, that stalwart of…
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The deed is done, the doers undone Had I been a Brit, I would have voted ‘Remain’ rather than Brexit (or ‘Leave’). Instead, I have been bemused by the comic theatre of British politics, fascinated by what the Brits actual think and professionally interested by the revelations of the complexity of the interactions between Britain…
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This was submitted to a British news publication in late December, but was not published. Brexit is a great puzzle to New Zealanders. Britain and New Zealand are affectionate cousins with common ancestors back in the nineteenth century. We have gone our own ways; even so we have views of the other’s ways. New Zealand’s…
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Comparative advantage is rarely important in modern trade deals, such as TPP11 (CPTPP). Why bother? Economics students have ‘comparative advantage’ drummed into them. The intuition seems commonsense; specialise in what you (or the country) do well and exchange the surplus for what you are not as good at. The economist’s Heckscher-Ohlin model which makes the…
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The growth of farm output may be slowing. Specialty cheeses show an alternative strategy of further post-farmgate processing. Land for farming ran out in the 1950s. Farm production intensified. We shifted from more dollars of farm output by using more land to getting more dollars per unit of land. Among the challenges we had was…
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Extracted from a paper delivered to Wellington South Rotary; 22 March 1. The US is No Longer The International Hegemon There have been only two global hegemons – states with political, economic and military predominance or control over all others.. One was Britain in the nineteenth century. It was replaced by the US from about…
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Paper to Wellington South Rotary; 22 March, 2017 Thankyou for the invitation to talk about contemporary world economy. I am not going to give a blow-by-blow account of the challenges New Zealand currently faces; instead I am going to place them in a broad context. What I am arguing – I am uncertain, of course…
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This is a follow up ‘Brentry: How New Zealand Coped’, setting out some of the challenges which face New Zealand today. The strategic view that Britain needs to be in the EU remains universal among New Zealand strategists. However the Leaves did not vote geopolitically but on domestic considerations including, apparently, resentment of immigration and…
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This is based on a note that I prepared for a journalist. It is a lead into the next column which is on ‘Brexit: How New Zealand Might Cope’. New Zealand has an unusual situation in the world economy. Despite being among the affluent economies, its success is vitally dependent upon the export of some…
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Although completed a decade ago, Tony Judt’s history of postwar Europe presaged some of the challenges that it faces today. Shortly after the collapse of the Berlin Wall in 1989, one of our greatest contemporary historians Tony Judt resolved to write a book to sort his thinking out. It took fifteen years, but the resulting Postwar:…
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Can Trump wreck the world trading system? New Zealand is such a small country that it is very easy to be internationally bullied. Much of our diplomatic effort aims to minimise such bullying, but fear of it lurks behind concerns about what a Trump administration might do, not only to us but the rest of…
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Paper to the Fabian Society, 12 October, 2016 While we continue to chew over the carcass of the Fourth Labour Government – the Lange-Douglas one – we pay little attention to the subsequent Fifth Labour Government. Yet the Clark-Cullen one is greatly shaping the current Labour Opposition and the current National Government. It will,…
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We don’t need to refresh trade policy; we need to rethink how best to engage with the world in the context of increasing globalisation. The Government is ‘refreshing’ its international trade strategy. Refresh is a euphemism. It ought to overhaul it. Here are some guidelines; I begin with the overarching framework. The context is globalisation…
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