Paradigms Of New Zealand Economic Growth: a Memoir (part II)
This paper was written in August 2004, for no particular purpose other than to clarify my own ideas.
Part I
Keywords: Growth & Innovation; History of Ideas, Methodology & Philosophy;
Category Archives: History of Ideas, Methodology, Philosophy
Some Comments About the Theory and New Zealand Economic Growth
Formal contribution to the MED Panel on economic growth: 24 March, 2004.
Keywords: Growth & Innovation; History of Ideas, Methodology & Philosophy;
In the last three weeks we have had three interesting introductions to elements of growth theory. I do not see them as independent paradigms contesting with one another, but rather they are different facets of a more comprehensive growth theory. One thing which came through clearly, is that Solow’s neo-classical model of growth, now 45 odd years old, was both a powerful stimulus to growth theory, but very deficient. Much of the work of the last five decades has been trying to overcome those weaknesses. Many remain unresolved, and the empirical underpinnings of growth theory are still tenuous. Yet we tend to lapse back into a pure Solow model with its high degree of aggregation and vague notions of technology.
Oxytoxic Times: Emotions Are Getting in the Way Of Economic Theory.
Listener 27 December, 2003.
Keywords: History of Ideas, Methodology & Philosophy;
There was much laughter over the economist who presented a paper that assumed people made optimal calculations when deciding on higher education. The paper plodded on for pages, but came to a grinding halt with a mathematical equation that the presenter could not solve –– without the wit to conclude that the study demonstrated that one needed a degree in mathematics in order to decide whether to go to university.
Treasury: the New Zealand Treasury 1840-2000, Malcolm Mckinnon
This is a much longer version of a review published in New Zealand Economic Papers, 37(1), December 2003 295-302.
Keywords: Governance; History of Ideas, Methodology & Philosophy; Political Economy & History;
Treasury Secretary from 1986 to 1993, Graham Scott, got it quite wrong when he said shortly after the 1987 election, ‘I’m interested in getting back to the old money-bags role, what Treasury did in the nineteenth century – the core of the finance ministry is its old functions. That’s our knitting.’ Historian Malcolm McKinnon is too polite to point out this is another example of an ahistorical economist misrepresenting the past. Except by his writing a history of the Treasury.
Public Intellectuals (index)
Keywords: History of Ideas, Methodology, Philosophy;
The New Intellectuals?
Panel Presentation for Public Intellectuals Seminar, Friday 26 September. An earlier panel was Public Policy and Thinktanks
To continue the approach of focussing on the public intellectual discourse, in which case the issue of the New Intellectuals is under what conditions might they occur. At issue, then, is whether those conditions have changed sufficiently to be able to say ‘new’. Here I look at, as befits my profession, resources and institutions.
Public Policy and Thinktanks
Panel Presentation for Public Intellectuals Seminar, Friday 26 September. A later panel was The New Intellectuals?
To begin, as is appropriate, with a dissent from the conventional wisdom. The notion of ‘Public Intellectuals’ seems to me to be unhelpful, because it focusses on individuals, and is likely to generate jealous spats of just who is or who is not one. It is the public intellectual discourse which we should focus on, the process by which intellectual activity is applied to questions of public policy in its widest sense.
Intervention and Innovation
Chapter of TRANSFORMING NEW ZEALAND. This is a draft. Comments welcome.
Keywords: Growth & Innovation; History of Ideas, Methodology & Philosophy;
Underlying much modern economic analysis is a faith in the efficacy of the market, which Adam Smith attributed to an invisible hand which promotes a beneficial end which is not the intention of those involved in the market transactions. Actually, his much cited ‘invisible hand’ includes support for domestic over foreign investment which suggests that the future customs officer was not quite the free-marketer his followers attribute to him. Indeed scholar Emma Rothschild, observing he mentions the invisible hand only three times in all his writings, suggests he was being ironical. Even so, Smith’s conjecture led economists to wonder to what extent the market promotes a common good.
Socialists Of the Heart: Why Does the Left Avoid Rigorous Economic Argument
Listener 3 May, 2002.
Keywords: History of Ideas, Methodology & Philosophy;
The Left critique of society was born in the turmoil of nineteenth century European industrialisation, when communities were ripped apart and workers suffered terrible, and often short, lives. Economics was transformed too, with the analyses of Karl Marx and Alfred Marshall leaving behind the pleasant world of agriculture and commerce of Adam Smith and David Ricardo. The Left engaged with the mainstream economists of the day. One can get an introduction to the neo-classical economics of the late nineteenth century by reading the British socialists of the times, who were not nearly as taken with Marx as the world was after the Russian revolution. Their roots are not in Marxists but in the Christian dissenters, such as Methodists.
What Might a Left Wing Economic Policy Begin to Like? Some Notes
Keywords: History of Ideas, Methodology & Philosophy;
It is best to think of this as a draft – and very preliminary. Comments welcome. Further of my writings on the left will be found at Economics of Socialism (Index).
The Listener column, ‘The Left and Economics (3 May 2003) elicited a number of the readers of the draft version asking me what a modernised economics of the left might look like. My response was ‘Who me? I’m only an economic columnist’. In any case few would put me among the Left, other than those who are so far to the right they object to the road rules.
Being a Public Intellectual
Lawrence Simmons and Brian Easton in dialogue The following is based on a dialogue between Lawrence Simmons and Brian Easton, which took place in early 2003. It is the basis of a chapter in speaking Truth to Power: Public Intellectuals Rethink New Zealand, edited by Laurence Simmonds and published by Auckland University Press in…
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Two Great Economists: Raymond Firth (1901-2002) & James Tobin (1918-2002)
Listener 25 January, 2003.
Keywords:
History of Ideas, Methodology & Philosophy; Macroeconomics & Money; Maori;
I would start a beginning course in economics with Economics of the New Zealand Maori by Raymond Firth, who died last year. Not only is the book a part of our heritage but it confronts students with the classical Maori economy which answered the central economic problems of ‘what, how, for whom, where and when’ in quite different ways from today. Starting with an alternative to the narrow idealised version of the US economy which they are usually taught, would help students realise how special it is. It might even suggest that every economy is particular, and such general economic principles there are, need not result in the policies which slavishly follow from the idealised US one.
Money Can’t Buy You Love
Why can’t economists measure wellbeing as material wealth?
Listener 11 January 2003.
Keywords: History of Ideas, Methodology & Philosophy;
While there is considerable national agreement that economic policy should aim to accelerate the growth of sustainable GDP, Gross Domestic Product only measures material output. Its designers never not intended it to assess human welfare. As economists have known for more than fifty years, GDP is not a good measure of wellbeing. While people in cold climates have bigger fuel bills, they are not necessarily better off than where it is warm. People in insecure environments spend more on the police and military, but better to be in a secure community. Where does friendship fit into GDP? Attempts to extend the concept (to include such things as non-market activities and the environment) do not solve the basic problem that material output is not the same thing as happiness.
Validation and the Health and Household Economy Project
Paper to the Wellington Health Economists Group, Thursday 29 November, 2002.(1)
Keywords: Distributional Economics; Health; History of Ideas, Methodology & Philosophy; Statistics;
Introduction.
This is a brief summary of a 100 plus page report, The Economic and Health Status of Households,(2) prepared by Suzie Ballantyne and myself. The data base was the Household Economic Survey (HES). For the three year period covering 1994/5-1996/7 the HES included questions on the respondents’ recent utilisation of health services together with as a subjective assessment of each’s health status, as well as socioeconomic variables such as income and expenditure and personal characteristics.
Economic Reforms: Index
History
Sequencing (December 1983)
Freeze and Thaw
(July 1984)
Ssh …It’s the Big ‘‘D’’ (August 1984)
Confidentially Yours (August 1984)
Devaluation!: Five Turbulent Days in 1984 and Then … (July 1985)
Economic Liberalisation: Where Do People Fit In?
(May 1987)
From Run to Float: the Making of the Rogernomics Exchange Rate Policy (September 1989)
Liberalization Sequencing: The New Zealand Case (December 1989)
Towards A Political Economy of New Zealand: the Tectonics of History (October 1994)
The Wild Bunch?: An Inquiry is Needed to Restore Treasury’s Integrity (August 1996)
The Great Diversification: Ch 9 of Globalization and a Welfare State (December 1997)
The State Steps In: Michael Bassett Makes A Case for Intervention. (August 1999)
Remaking New Zealand and Australian Economic Policy by Shaun Goldfinch (August 2001)
The Treasury and the Nationbuilding State (December 2001)
Evaluation
New Zealand’s Economic Performance This is an Index
Economic and Other Ideas Behind the New Zealand Reforms
(October 1994)
For Whom the Deal Tolls (Of Dogma and Dealers) (August 1996)
The Economic Impact of the Employment Contracts Act (October 1997)
Microeconomic Reform: The New Zealand Experience (February 1998)
Some Macroeconomics of the Employment Contracts Act (November 1998)
View From Abroad: What Do We Know about Economic Growth? (May 1999)
The Model Economist: Bryan Philpott (1921-2000) (August 2000)
Comparison with Australia: New Zealand’s Post-war Economic Growth Performance (August 2002)
The Debate
Waist Deep in the Big Muddy? (February 1991)
Friends in High Places: Rogernomic Policies Have Powerful Allies in Australia (April 1994)
Systemic Failure (December 1995)
Ignoring the Critics (February 1997)
A Permanent Revolution? (March 1997)
In the Dark: The State of Research Into the Economy is An Embarrassment (June 1997)
The New Zealand Experiment: A Model for World Structural Adjustment? (Review) (July 1997)
Out of Tune: Even the Officials Admit the Health Reforms Were Fatally Flawed. (December 1997)
Money for Jams: the Government Response to Roading Reforms is Commercialisation. (January 1998)
Reforms, Risks, and Rogernomics (March 1999)
The London Economist and the New Zealand Economy (December 2000)
Locked Out: of Free Press and Free Economics (May 2001)
A Surplus of Imitation (June 2001)
Government Spending and Growth Rates: A Methodological Debate (January-May 2002)
From Pavlova Paradise Revisited by Austin Mitchell (July 2002)
Manure and the Modern Economy: Has Economic Policy Hardly Changed? (September 2002)
From is This As Good As it Gets? (December 2002)
1999 and All That (January 2004)
Books
The Commercialisation of New Zealand (1997)
In Stormy Seas: the Post-war New Zealand Economy (Chapters 15-16) (1997)
The Whimpering of the State: Policy After MMP (1999)
Economists & Philosophers: Index
This is not complete. Use the search facility. The list has only major references to the individuals named.
The Economy and Other Issues: What the Election Campaign Didn’t Tell Us.
Listener 24 August, 2002
Keywords History of Ideas, Methodology & Philosophy; Political Economy & History; Regulation & Taxation
The economic debate was noticeably missing from the election campaign, as the public turned its attention to other concerns. This suggests an economic consensus (almost) arising from the economic prosperity over the last three years, plus an increasingly widespread agreement that economic policy is going in the right direction.
A Beautiful Theory: But It Is Only a Game
Listener 13 July, 2002.
Keywords History of Ideas, Methodology & Philosophy
The film A Beautiful Mind was another version of Love Story. Instead of the lovers having to overcome health, race, other obligations, or location, this time the obstacle was mental illness. Ultimately John and Alicia Nash triumph, with a Nobel Prize in economics to boot. The true story is far more complicated, and in some key places different. More disappointing, the film made only the feeblest attempt to explain what Nash actually did. Hollywood must have thought the concept too difficult for the average film-goer. Let me accept the challenge.
The Origins Of Four Books
Part of submission for the degree of Doctor of Science from the University of Canterbury. (April 2002)
Keywords: History of Ideas, Methodology & Philosophy;
I began studying economics at the University of Canterbury in 1962, while doing my honours science degree in mathematics, and in late 1963 took up the position of Research Assistant at the N.Z. Institute of Economic Research, completing my B.A. in economics at the Victoria University of Wellington. As a result I got a very wide training in economics – in macroeconomics, microeconomics, development economics, and public policy – covering both theory and applied economics.
Being and Doing
The Tricky Economics of Creating a Better Quality of Life
Listener 26 January, 2002.
Keywords History of Ideas, Methodology & Philosophy
The life expectancy of someone living in Western Europe or North America was about 45 years in 1900. Today it is closer to 80 years. The increased longevity reduces the material standard of living (measured by GDP* or consumption per capita), since people are now retiring for far longer. Is the increased life expectancy a good thing? If we were to execute everyone over 65 years of age, we would raise the GDP per capita figure by about the same as the increase since 1981. Why dont we?