The Old Commonwealth and Britain's First Application to Join the EEC, 1961–3

New Zealand, Canada, and Australia reacted in different ways to Britain's decision in 1961 to seek membership of the EEC. We show that the umbrage taken by the members of the old Commonwealth was in inverse proportion to the economic interests at stake. Canada, whose trade with Britain was relatively small, adopted a position of violent opposition to British policy. New Zealand, which was still heavily dependent on the UK as a market for staple commodities, was careful to avoid acting in a manner likely to alienate the British government. Australia, which was in an intermediate position as regards the importance of its trade with Britain, mounted a sturdy defence of its commercial interests, but did not indulge in the histrionics of the Canadians. All three of the old dominions were disappointed with the arrangements for Commonwealth trade towards which the UK and the Six were moving when de Gaulle vetoed British membership in January 1963, but at least New Zealand had obtained some special concessions. Whilst it is unlikely that a less combative attitude by Canada and Australia would have resulted in a better outcome for these countries, a more belligerent approach on the part of New Zealand would have put its economic future in even greater jeopardy.     

New Zealand's economic relations with Japan in the 1950s

New Zealand's special economic relationship with Britain was brought into question during the 1950s. The subsidization of British farmers, and the dumping of foreign food surpluses in the UK, made New Zealand's traditional market seem increasingly insecure. Wellington responded by seeking supplementary outlets, and in 1958 a commercial treaty was signed between New Zealand and Japan, despite the alarm of British manufacturers. New Zealand's trade with Japan grew after 1958, although it failed to grow as quickly as trade between Australia and Japan. The Japanese were reluctant to import many animal products. This article explains the process by which Japan and New Zealand arrived at a compromise, which enabled trade to develop without seriously damaging the interests of protected groups in either country.     

Emigration from the United Kingdom to the United States,Canada and Australia/New Zealand, 1870–1913: Quantity and quality

This paper revisits the determinants of emigration from the United Kingdom to the United States, Canada and Australia/New Zealand from 1870 to 1913. In the absence of restrictive immigration policies, the flow of emigration to these destinations responded to economic shocks and trends. Emigrants to Australia and New Zealand were more skilled on average than those heading across the Atlantic, a feature that does not correspond well with skill differentials in the manner predicted by the Roy model. While assisted passages (subsidised fares) increased the volume of emigration to Australia and New Zealand they cannot account for its higher skill content.     

Social democracy and market reform in Australia and New Zealand

Social democratic governments in Australia and New Zealand adoptedpolicies of radical free-market reform, including financialderegulation, privatization, and public-sector reform in the1980s. Because of the absence of institutional obstacles togovernment action, reform was faster and more comprehensivein New Zealand than in Australia. The New Zealand reforms wereassociated with increasing inequality and generally poor economicoutcomes. There is nothing in the New Zealand experience tosupport the view that radical free-market economic policiesare consistent with social democratic welfare policies or withsocial democratic values of concern for the disadvantaged. TheAustralian reforms were less radical, and were accompanied bysome refurbishment of the welfare state. Economic performancedid not improve, as anticipated by advocates of reform, butwas considerably better than that of New Zealand.     

Commanding the Middle: The American Agenda at the Kennedy Round

The Kennedy Round of GATT was an opportunity for Australia and New Zealand to achieve their commercial interests of expanding agricultural exports and adjusting trade flows to the power of the United States, the loss of preferential markets in Britain and the new presence of the European Common Market. Both found commonalities with America, both managed to assert some of their concerns, but both also were decidedly junior and weaker partners to the free-trading United States in the GATT regime. The issues explored in this article range from trade in commodities to the protests of the Third World.     

The shift from sterling to the dollar, 1965–76: evidence from Australia and New Zealand

The management of foreign exchange reserves has recently attracted attention from both policy‐makers and historians. Historical research has focussed on the nineteenth century and the interwar period, with less attention to the strategies of smaller countries in the final transition from sterling to the dollar in the post‐1945 period. This article examines the evolution of reserve currency policy from the perspective of Australia and New Zealand in the 1960s and early 1970s. As in the 1930s, economic uncertainty and a shift in global economic power prompted changes in reserves strategy. Patterns of trade and debt and falling confidence in British economic policy prompted a move away from sterling, but the timing and extent of this transition were affected by the fragility of the sterling exchange rate, lack of alternative assets, and continued dependence on the London capital market. The choices for Australia and New Zealand were thus constrained, but they were able to leverage their position as holders of sterling to engage in agreements that provided an exchange rate guarantee for their sterling holdings and continued access to the London capital market. This mitigated the effect of the final global transition from sterling to the dollar while protecting their interests.     

THE MOMENTOUS GOLD RUSHES

Gold discoveries in Australia in 1851 and New Zealand in 1861 galvanised the economic development of Australasia and had spillover effects in Britain, in ship technology, and even in the trans-Atlantic trade. The gold rushes quickly transformed economic, social, and political life. Moving around the continent in an anti-clockwise direction, they were to help found the northern port cities that grew to service the gold seekers. While the major strike in Western Australia in the 1890s out-produced the earlier period, Australia saw a third gold peak in the 1990s. The article surveys the contribution of the rushes to the development of Australasia.     

Economic integration and the foreign exchange

This paper demonstrates effects of economic convergence processes on the foreign exchange behaviour in a monetary modelling approach. Since the exchange rate represents the relative price of two currencies, commonness of stochastic trends between the fundamental determinants of supply and demand of the underlying monies restricts exchange rate movements to transitory fluctuations. In the spirit of optimal currency areas, this has the potential to serve as a criterion for an all-round integration of two economies. Empirically, such a constellation is found between Australia and New Zealand, whereas diverging trends in money and interest rates characterise the relation of Australia towards the US.     

The Evolution of an Intellectual Community Through the Words of Its Founders: Recollections of Australia's Economic History Field

Analysing the dynamic evolution of a scholarly field requires an understanding of the social interactions within its community as well as the impact of the written word. Influence might diffuse through mentoring, graduate supervision, seminar discussion, and management roles. To date, our knowledge of the growth of economic history in Australia after 1945 draws heavily upon the impact of a number of key publications. We interview a broad selection of academics who worked in the field of Australian economic history, approximately 1950–90, to provide a fuller understanding of the evolution of this interdisciplinary field. Our results confirm, complement and, in some cases, challenge conventional views. © 2016 Economic History Society of Australia and New Zealand and John Wiley & Sons Australia, Ltd     

Trans-Tasman Transmission of Monetary Shocks: Evidence From a VAR Approach

This paper investigates the cross-country transmission mechanisms of monetary shocks between Australia and New Zealand within a VAR framework for the period 1985:1–2003:4. The empirical results indicate that a monetary shock in either Australia or New Zealand has real effects in the short-run in both countries however, an Australian shock generates more significant responses of most variables. Australian output is found to be significantly more sensitive than New Zealand output to monetary innovations in either country. The results also suggest that monetary innovations in a small open economy can also influence its larger trading partner.The authors would like to thank Faik Koray and an anonymous referee for their valuable comments. The usual disclaimer applies.     

BASKET PEGS AND EXCHANGE RATE REGIME CHANGE: AUSTRALIA AND NEW ZEALAND IN THE MID‐SEVENTIES*

The adoption of a basket peg by China in July 2005 raised interest in this form of exchange rate regime. This paper explores the emergence of the basket peg in the early 1970s, using New Zealand and Australia as case studies to examine why it was adopted, how it operated, and their policy‐makers' use of it to influence various goals. We highlight the complexity of regime choice following the collapse of Bretton Woods. For Australia and New Zealand, the basket peg was a plausible (although interim) solution when they were reluctant either to peg to a single currency or float.     

The Commonwealth as an Economic Network

Research on the economics and sociology of business networks also sheds light on the development of networks of countries. The British Commonwealth was an important global network, or group of networks, in the mid-twentieth century. Commonwealth members, including Australia and New Zealand, cooperated in the management of the Sterling Area and the Commonwealth Preference Area. Yet Commonwealth members also had links to other networks and other sources of influence including the USA, continental Europe and Japan. During the 1950s and 1960s, there was a gradual change in the network relations of Australia and New Zealand, involving a diminution in the importance of bilateral ties with Britain.     

THE SUPPLY OF ECONOMIC HISTORY IN AUSTRALASIA: THE AUSTRALIAN ECONOMIC HISTORY REVIEW AT 50

In 2010, the Australian Economic History Review published its 50th volume. To mark the occasion, we present a quantitative analysis of the output of economic and business history that has appeared in its pages since 1956, and review the development of the discipline through its journal editors. Content was until recently overwhelmingly focused on Australia and New Zealand economic and business history, despite the efforts of past editors to attract more scholarship on the wider Asia‐Pacific region. Articles on Asia and the rest of the world have become more common since the late 1990s.     

Regional Economic Integration in the Pacific: An Empirical Study

Abstract

The Pacific Islands Forum, the regional organization comprising 14 Pacific Island countries (PICs), Australia and New Zealand is committed to strengthen regional cooperation and integration. This paper examines progress in real and financial integration in the region. Utilizing the methodology based on international parity conditions: purchasing power parity and uncovered interest parity, the study concludes that while PICs’ integration amongst themselves and with Australia and New Zealand, is relatively advanced with respect to goods and services, the financial market integration remains incomplete. The policy implication is impact of further liberalization is likely to be substantial on financial markets.     

The Murupara Project and Industrial Development in New Zealand 1945–65

In New Zealand, after the Second World War, the share of manufacturing in GDP rose relative to the share of agriculture. Although the government lacked a clearly articulated industrial policy, it was increasingly drawn into the promotion and support of firms in manufacturing. The Murupara pulp and paper scheme was the most spectacular instance of state intervention in the first two postwar decades. Tasman, the company set up to operate the pulp and paper mill, was a joint venture between the state, a New Zealand construction firm called Fletchers, and British multinationals. Tasman soon became New Zealand's leading exporter of manufactured products. The need to secure the market for Tasman's newsprint exports was one of the main reasons for the negotiation of a partial free trade agreement between New Zealand and Australia in 1965. This article explains the early history of Murupara, and discusses its contribution to industrial development and diversification in New Zealand.     

Optimal Monetary Policy Rules and Inflation Targets: Are Australia,Canada, and New Zealand Different from the U.S.?

Outwardly, the central banks of Australia, Canada, New Zealand, and the U.S. follow somewhat different approaches to controlling inflation. The U.S. does not explicitly target inflation while the other countries do. Canada and New Zealand have target bands for inflation while Australia has a point target. Results in this paper nevertheless find broad similarities in the monetary policies of these countries. Each can be described as having pursued optimal inflation targeting (explicit or implicit), with heavy interest rate smoothing, but perhaps placing little weight on output variability. We argue that interest rate smoothing is used to introduce gradualism into the response of monetary policy to inflation. We show that given heavy interest rate smoothing, a concern for output variability is redundant.     

AUSTRALASIAN ECONOMIC HISTORY: RESEARCH CHALLENGES AND BIG QUESTIONS

This paper reports a debate on the 'big questions' and 'research challenges' facing economic history in Australia and New Zealand. Noting the changes in research direction that occurred in the discipline over the past 50 years, and the resource challenges it currently faces, it identifies many areas of potentially fruitful research. These include the environment, market regulation and industry development, the interaction of peoples and culture, and the examination of units other than the national economy. While there is potential for exciting and diverse research, an immediate challenge is the training of the next generation of economic historians.     

‘LONG SLOW BOOM’?: MANUFACTURING IN NEW ZEALAND, 1945–70

Many studies of post-war New Zealand economy are highly critical both of economic policy and of the business sector, emphasising protection, complacency and sclerosis. This article argues that such accounts are excessively simplistic and, by analysing the structure and performance of New Zealand manufacturing during 1945–70, suggests that there was considerable innovation in both technological and organisational spheres. The result was that, to a greater extent than current accounts allow, New Zealand manufacturing pursued efficiency and international competitiveness.     

Regime shift and fast recovery on the periphery: New Zealand in the 1930s

New Zealand's recovery from the Great Depression was unusually fast and promoted by a new monetary regime that disassociated the Dominion's banking system from that of Australia, and broke the conventional parity between the New Zealand pound and sterling. The new regime destroyed deflationary sentiments, redistributed income to farmers, and sharply reduced real interest rates. Collectively, these forces promoted recovery. The consequences for New Zealand's real GDP are gauged by assessing how money, velocity, and prices would have behaved without a regime change. The new monetary regime raised real GDP per caput by one–third by 1938.     

The Geography of Inventiveness in the Primary Sector: Some Initial Results for New Zealand, 1880–1895

At the turn of the twentieth century, New Zealand was one of the wealthiest nations in the world on a per capita basis. We examine the role of innovation in explaining New Zealand's economic performance. Using a new dataset on patent applications for the period 1880–95, we consider whether the geographical concentration of innovative activity influenced economic activity. We find relationships between agricultural and pastoral output indices and inventiveness and between different regions and related industries. The results, however, are relatively weak. We conclude that tests of agglomeration effects in New Zealand during this period deserve further attention.