Interlocking Directorates in New Zealand

Abstract

The possible domination of the New Zealand economy by large economic units is a matter of considerable interest. New Zealand, by world standards, is a small economy, and this means that any large firm can be very influential in its own right. Also, smaller firms can combine their resources by undertaking various agreements which have the effect of presenting, from the point of view of the total economy, a new entity consisting of the total resources of the firms involved. Thus, firms which individually might not be of much importance in the economy, can collectively become an influential force. There are a large number of ways by which a firm may reach agreement with other firms in an attempt to improve its relative strength in the economy. Included among these are price cartels, area agreements, (that is, each agrees to sell within a defined geographical area), patent licensing agreements, supply contracts, collective tendering, joint ownership of two entities by a third (either a firm, institution or individual) and interlocking directorates.