PRICES IN NEW ZEALAND.

New Zealand Herald, Volume LXVII, Issue 20759, 30 December 1930, Page 6

PRICES IN NEW ZEALAND.

The latest statistical examination of prices in New Zealand, the results of which are published in a group of tables in the official Abstract of Statistics, shows that the universal fall in pricey of primary products has so far had only a small effect on other classes of prices. Export prices in November were 33 per cent, lower than in November of last year, the heaviest fall having been in wool, and the least in meat. The recorded value of all exports ip 11 months of this year was £9,000,000, or nearly 18 per cent., less than in the corresponding period of 1929. Only a fraction of either of these movements has been registered in any of the index numbers of internal prices. The average wholesale cost of imported goods rose until April and then fell sharply until July. The revision of the customs tariff was no doubt the principal cause of a 4 per cent, increase in the following month, and though the decline has been resumed, the index number for November is higher than it was a year ago. Wholesale prices of all commodities are, however, 4| per cent, lower than in November of 1929. Retail prices have fallen in the 12 months by only 3 per cent., the movement having been remarkably regular from month to month. Food prices are shown to be about 5 per cent, lower; in the clothing, drapery and, footwear group, the decline has been rather more; the rent item is only 2 per cent, lower; fuel and light on the average are slightly dearer. Prices in Auckland have been reduced more rapidly than in the rest of the Dominion, the change in all retail prices having been 4.3 per cent, as against the average of 3.2 per cent. ; food, clothing and rent are relatively cheaper in Auckland in comparison with the rest of New Zealand than they were a year ago. The latest compilation of wages is for the September quarter; it shows an index figure slightly higher than at the corresponding period in 1929. The lag of wholesale prices for finished goods and of retail prices generally behind those for raw materials is a familiar aspect of large economic changes, the explanation being that the total cost of production is a multiplication of the cost of materials alone, and that adjustment of the cost of all processes of manufacture and of distribution to a new level is necessarily slow. To a country such as New Zealand, in which virtually the whole population is engaged in the production, preparation and carriage of primary products for sale overseas, the fall in prices means an almost proportionate contraction in the national income and the adjustment should be made as speedily as possible unless some sections of the community are to enjoy special privileges at the expense of the impoverishment of those directly engaged in the unsheltered primary industries. Yet, the official calculations show that very little progress has yet been made toward an equitable distribution of the loss in aggregate income.