STANDARD OF LIVING
New Zealand's standard of living is generally regarded as being one of the highest in the world and is within the range achieved by such countries as the United States of America, Canada, the United Kingdom, the more advanced West European and Scandinavian countries, and Australia. This high position is derived in large part from New Zealand's close historical, cultural, and economic ties with the members of this group. There has thus been a ready absorption and early utilisation of the whole array of technical and organisational innovations associated with the rapid industrial progress overseas in the last 150 years. A low population density, coupled with favourable soils and climatic conditions, has made it possible for New Zealand to share directly in the increasing prosperity of these countries, largely by trading wool, meat, and dairy produce for the manufactures of the United Kingdom.
New Zealand's high standard of living is related to its favoured position on the periphery of the world's more dynamic economies. But the difficulty of maintaining and improving living standards on this basis has long been recognised; hence Government policy in recent years has been directed to building up in New Zealand an industrial structure which it is hoped will reduce the country's dependence on the sale of primary produce. As yet, such development is at a comparatively early stage, and it is essential that it be directed to areas where maximum increases in productivity can be achieved. It is only by increasing productivity that our high living standard can be maintained and improved.
Although the term “standard of living” is widely used, it has no accepted definitions and measures. There are difficulties inherent in comparing standards of living between different places and between different points of time. For example, the number of refrigerators per 1,000 persons may appear to the New Zealander as a useful and fairly central indicator. But this unit does not serve very well if we wish to compare our present standards with those of the Alaskans of today, or with those of New Zealanders 50 years ago. In the former case we would assume a lower need on the part of the Alaskan and, in the latter, changes in the methods of refrigeration and in types of food used would prevent true comparisons. Who is to say that the use of an icebox represents a lower standard of living than that of a refrigerator? Similarly, a motorcar is a different measuring rod for the Russian, whose Government has put emphasis on the development of communal rather than of private transport, for the New Zealander, or for the citizen of the United States of America where there is an extreme dependence on private transport. International comparisons of this type are usually made in terms of units per head or per 1,000. This method takes no account of variations in patterns of distribution between various sections of the population.
Thus, of two countries with the same average income per head, one may have a very unequal distribution of income with a few very rich and many very poor while, in the other, all incomes are at very much the same level.
Some idea of the New Zealand standard of living, in comparison with that of some other countries, is given by the table.
by John Victor Tuwhakahewa Baker, M.A., M.COM., D.P.A., Government Statistician, Wellington.