The aim of this paper is to offer some perspectives on the type of policy interventions that will lead to material improvement in New Zealand’s productivity. New Zealand’s small size – and a small number of large or high growth firms – makes it feasible to use this firm-focused perspective to generate specific insights on how to raise aggregate productivity.
A key message from this work is that small economies can be very successful. Indeed, the small countries the report studied were generally high-performing and had better economic and social outcomes than their larger peers.
Yet, the report argues, compared to small advanced economies like the Netherlands, Switzerland and Denmark, New Zealand needs to do more to create large exporting companies.