Abstract :
This article reconsiders the argument advanced
or endorsed by a large number of leading
Australian academics and others that
labour productivity growth in New Zealand fell
markedly during the period in which New
Zealand’s Employment Contracts Act 1991
(ECA) was operative—that is, for most of the
1990s. On the one hand, based on total economy
estimates developed by The Conference
Board and the Groningen Growth and Development
Centre, labour productivity growth
was unexceptional though a little higher than
the New Zealand average of the last three decades
or so. On the other hand, based on newly
released official estimates of New Zealand’s
‘measured sector’ (which accounts for about
two-thirds of the total economy), labour productivity
growth was almost identical to that of
Australia during the ECA period. This in turn
suggests that New Zealand’s labour productivity
growth rose markedly for the measured sector
during the ECA years. All in all, the
evidence presented in this article is inconsistent
with claims that the period of the ECA was
associated with relatively weak New Zealand
productivity growth. Selected issues arising
from these findings are briefly canvassed.
