Post War Economic Reconstruction in New Zealand

I N THE PAST, interest in New Zealand has risen largely from the fact that it has been regarded as a social laboratory; but it is equally worthy of as a type of vulnerable or economy, by which is meant one whose commercial and financial relations are such that its prosperity is especially sensitive to disturbances from changes in world prosperity, which are transmitted into it by changes in relative prices. Since every economy has commercial or financial relations with other countries, all are dependent in the sense that they suffer economic disturbances owing to changes in external conditions. But New Zealand is useful as a study because it is a simple, and in some respects, extreme example of an important, general type. While the Dominion has its own special characteristics and problems, its comparatively simple economy, uncomplicated by the stresses emerging out of racial differences, or struggles for political independence or to achieve freedom from exploitation by an imperial power, enables the causes and effects of economic vulnerability to be readily analyzed and their implications in terms of international economic arrangements readily appreciated. Moreover, the Dominion is small so that by comparison with (say) the United Kingdom, which is also vulnerable, it has no great influence in the determination of world economic trends, nor can it take a strong initiative in the promotion and determination of international economic policies. Taken in the aggregate, small dependent economies are of considerable importance, but in the economic field, as well as in the field of political security, it is difficult for them to present a united front in pursuit of common interests. Within the British Empire, the Dominions may exert pressure which influence United Kingdom policy, but such pressures may be towards special preferences in Empire markets. In this case they hinder, rather than help, those measures of international cooperation which must be relied on to promote expansion without undue unstability. Generally, the influence of small, dependent economies on in

Geography · Political science · Australian History and Society · History · Island Studies and Pacific Affairs · New Zealand Economic and Social Studies