Aim Of N.Z. Economic Growth Questioned

Press, Volume C, Issue 29503, 3 May 1961, Page 17

Aim Of N.Z. Economic Growth Questioned

“111 fares the land, to hastening ills a prey, "Where wealth accumulates, and men decay."

This quotation from Oliver Goldsmith was used by the Assistant-Governor of the Reserve Bank (Mr A. R. Low) last night to justify the question: “Has not further economic growth become one of the less urgent objectives for New Zealand?”

Mr Low suggested to a meeting of the Canterbury branch of the Economic Society that certain other objectives more of a social or human nature than economic, might now be given a greater priority in New Zealand.

“I refer to such things as education, delinquency, racial relations, aid to underdeveloped countries, preservation of the family, prevention of road accidents and industrial accidents, the ending of international tension . . . the sort of things which are our most important lacks now, the things which detract from true welfare more than anything else," he said. An enormous amount had been written in recent years by academic economists on economic growth. “The very word ‘growth’ has acquired a prestige based on an emotional apneal; it has become a materialists religion.”

This attitude, understandable in under-developed countries, was less appropriate in New Zealand. “Have we not much less need than we used to have, and less than most other people in the world Mill have, for more and more things?” Mr Low asked This question was not really a digression in his talk (which was entitled ''Economic Growth, Full Employ, ment and Monetary Policy”). Mr Low said, for the following reasons:—

<1) The pursuit of the objective of economic growth was not inconsistent with a desire to achieve the noneconomic objectives he had mentioned. "On the contrary, it may be a necessary condition of their achievement. The physical resources devoted to education, prevention of delinquency. aid to undeveloped countries, prevention of accidents, etc. . . . must all come out of our production."

(2) "There is much to be said for the idea that ary community which ceases to strive for economic growth has lost vitality. Economic stagnation is likely to be associated with social and cultural stagnation.” (3) In spite of considerable wealth and a high average standard of living, it was still true that a significant proportion of New Zealanders were unable tn enjoy all the reasonable amenities of life.