Governments, Firms, and National Wealth: A New Pulp and Paper Industry in Postwar New Zealand

The state played an important role as political and economicmanager in postwar New Zealand. By fostering manufacturing,governments aimed to provide paid, productive employment, conserveforeign exchange, and support a welfare state. The history ofpulp and papermaking using state-planted pine forests is a goodexample of a government-business joint venture to create a newexport industry and new national wealth. Governments of bothmajor political parties cooperated in capital formation, landuse, hydroelectricity, roads, railroads, a modern port, andtown construction. This longterm state commitment helped propelthe industry toward largescale vertical integration so thatit could achieve economies of scale and scope and compete inworld markets.