Plotting a Market-Oriented Revolution
New Zealand went further in the adoption of market-oriented policies than any other advanced economy in the 1980s. This chapter investigates the role of economists within the state in this radical shift toward the market. It shows how the buildup of economic expertise in the New Zealand Treasury laid the foundations for the embrace of neoclassical economic thinking in the department in the early 1980s, including efficiency-oriented ideas about tax policy. This inspired a radical program of economic restructuring, which was put into action by New Zealand’s Labour government. Despite severe criticism and organizational reforms, the sway of state economists over tax policy largely persisted over the following decades, culminating in a further strengthening of the market orientation of the tax system in 2010.
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