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Browse the 1966 Encyclopaedia of New Zealand
Graphic: An Encyclopaedia of New Zealand 1966.


This information was published in 1966 in An Encyclopaedia of New Zealand, edited by A. H. McLintock. It has not been corrected and will not be updated.

Up-to-date information can be found elsewhere in Te Ara.



Changes in Price Levels

Only scattered records are available of prices prior to 1861. The “blue book” returned in 1851 to the United Kingdom by the colonial administration records the following commodity prices (1965 prices and subsidies are added for comparison):

1851 January 1965 (Subsidy Jan 1963)
Wheaten bread 3d. per lb loaf 4·31d. 2·16d.
Milk 4d. per quart 9·28d. 4·10d.
Butter 1s. per lb 2s. 8d.
Cheese 1s. per lb 2s. 2·13d. ..
Tea 1s. 3d.–1s. 6d. per lb 6s. 5·63d. ..

In the early years of the colony there was evidence of considerable variation in prices between settlements and throughout the year. Because of the high cost of transport associated with scattered settlement and the geographical remoteness of New Zealand, prices in New Zealand were generally higher than those in the United Kingdom. Some idea of the transport problems of the time is given by the fact that in 1857 letters moving from Auckland to Wellington were carried via Sydney.

The gold discoveries of the early sixties stimulated immigration and led to a sudden growth of population which, in turn, caused a rapid increase in the demand for goods, with a consequent rise in prices. A subsequent decline in gold production was followed by a fall in prices to a level below that at the beginning of the decade. Julius Vogel's public works policy (first enunciated in June 1870) and an associated cheap land policy led to a further boom in prices in the early seventies, but by 1874 prices had again begun to fall. This time the fall proved to be the beginning of a prolonged downwards movement which lasted to the middle 1890s. This was a period of depression for New Zealand marked by low export prices and the collapse of the land-settlement policy. “In many districts the majority of land holders were ruined, their properties were surrendered to the mortgagees many of whom suffered the same fate, the principal one – the Bank of New Zealand – receiving so heavy a blow through the properties thrown back on its hands that in 1894 its manager warned the Colonial Treasurer that unless the Government came to the bank's assistance within a day or two the country would suffer the worst crisis in its history.”

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