Government intervention in the New Zealand economy, 1914-18: its aims and effectiveness

Abstract

This thesis examines the New Zealand Government's interventions in the economy during the First World War. It looks mainly at the economic aims of the interventions, and evaluates their success or otherwise chiefly from an economic viewpoint. Some account is taken of the social and political objectives which the Government sought to attain by its interventions, and at the end a brief appraisal is made of whether they were warranted on these grounds. But the central focus remains the aims and effectiveness of the interventions from an economic standpoint. The First World War was not a period when the Government intervened in the economy to a great extent. Despite the fact that the Liberal Party, one more prone to intervening than most others of its era, had governed for most of the preceding 23 years, the economy remained largely unregulated prior to the war. And even under the stress of war there seems to have been a general consensus that the Government should go no further than it had to in interfering in economic matters. In all, 14 interventions are examined, the majority of them measures to control the prices of various goods and services. Generally, each chapter examines in detail one intervention. The question of why the authorities perceived a need to intervene is examined. Their economic aims are identified by looking at the Statute or regulation which enabled the intervention, and at the statements concerning it made by policy-makers at the time and afterwards. Judgments of the Courts are also examined in cases where the legitimacy of the intervention was tested at law, or where prosecutions followed a breach of the Act or regulation. Then an attempt is made to trace the effect of the intervention. In the case of a measure which aimed to control prices, its effect on the supply of and demand for the particular good or service is investigated, as well as its success or otherwise in keeping down the price. Finally, some attempt is made to evaluate the degree to which the intervention attained the economic end aimed at by the authorities.