The Minister of Finance says it is but, parochialism aside, are we doing anything to ensure it really is? One of the necessary skills of a politician is to hold on to at least two contradictory positions at once. * Consider how, following the report of 72,000 New Zealanders ‘permanently’ leaving the country in the…
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What have the 2025 Nobel awards in economics to say to us? One of the economic puzzles of human existence is that for most of it, going back to its beginnings, the material standard of living did not change much. Then, about 200 years ago, it began increasing; in some places more than others but…
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A physician’s memoir describing a successful research program leads to pondering about research funding strategies. A few years back, I was, in effect, commissioned to review the development possibilities of a local biotech industry, especially one for creating new pharmaceuticals. At the time, it was fashionable in every regional plan – anywhere in the world…
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The Government’s Growth Strategy Seems to Have Little Analytic Content. In 1990, the Prime Minister, Geoffrey Palmer, announced that he would halve unemployment – its rate was then more than 7 percent of the labour force. An OIA request turned up no technical papers. Apparently, the PM’s political advisers – jock wankers/politicos – thought the…
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Peter Frankopan’s The Earth Transformed: An Untold History is a compelling account of the interaction between humans and the environment. We would be unwise to ignore it. The Silk Roads: A New History of the World by Oxford professor of history Peter Frankopan was initially widely admired. But critics point out that the book exaggerated…
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The Yes Prime Minister This transcript of a recent conversation between the Prime Minister and his chief economic adviser has not been verified. We’ve announced we are the ‘Yes Government’. Do you like it? Yes, Prime Minister. Dreamed up by the PR team. It’s about being committed to growth. Not that the PR team know…
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We need to think about the pattern of the economy in 2050 (or whenever), not just its level of production. Focusing on productivity (and population) growth is a trap. Long-term strategic analysis requires attention to the composition of those aggregates. Nor should we over-focus on GDP as the ultimate outcome of the economy or the…
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Last week’s column mentioned the three 2024 Nobel laureates in economics. The column focused only on the 2012 book Why Nations Fail by Daron Acemoglu and James Robinson with little reference to Simon Johnson, although the three have worked closely together for about 30 years. Johnson published last year, with Acemoglu, a 599-page book: Power and Politics: Our…
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This year’s Nobel awards in economics raise critical issues about the future of the world. I was not alone with high hopes when the Soviet Union collapsed. It has been good to see various nations leave the yoke of the Soviet Empire and move towards liberal democracies with thriving economies although sometimes it has been…
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‘Perspectives of Two Island Nations’, Ann-Marie Schleich (ed), Ch 14, pp.185-194. Singapore and New Zealand have much the same population – a bit over five million people. They are both affluent economies. Because of their resource base and location, they have rather different economic structures. Yet the two small economies work together in international fora….
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An Infrastructure Commission report says we are keeping up with infrastructure better than we might have thought from the grumbling. But the challenge of providing for the future remains. I was astonished to learn that the quantity of our infrastructure has been keeping up with economic growth. Your paper almost certainly has daily reports of…
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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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There is a constant theme from the economic commentariat that New Zealand needs to lift its economic growth rate, coupled with policies which they are certain will attain that objective. Their prescriptions are usually characterised by two features. First, they tend to be in their advocate’s self-interest. Second, they are unbacked by any systematic empirical…
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Robert Solow transformed the way we think about economic growth. When you are in the trenches, you may not always realise what the war is about. Years later you read an account and see more clearly. Thus it was with me in the 1960s when economic analysis went through a revolution. My insight came later…
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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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Alan Bollard, formerly Treasury Secretary, Reserve Bank Governor and Chairman of APEC, has written an insightful book exploring command vs demand approaches to the economy. The Cold War included a conflict about ideas; many were economic. Alan Bollard’s latest book Economists in the Cold War focuses on the contribution of seven economists with each one…
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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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A close analysis of the Treasury assessment of the Medium Term in its PREFU 2023 suggests the economy may be entering a new phase. Last week I explained that the forecasts in the just published Treasury Pre-election Economic and Fiscal Update (PREFU 2023) was similar to the May Budget BEFU, except that it showed weakening…
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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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Thursday 24 November The Commission’s report on the seminar is here. It includes the my overheads which accompanied the presentation. Introduction I have been commissioned to prepare a report for the New Zealand Productivity Commission’s inquiry into economic resilience. The purpose of the report is threefold: 1. to describe how New Zealand has attempted to…
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