Governments, Firms, and National Wealth: A New Pulp and Paper Industry in Postwar New Zealand

The state played an important role as political and economic manager in postwar New Zealand. By fostering manufacturing, governments aimed to provide paid, productive employment, conserve foreign exchange, and support a welfare state. The history of pulp and papermaking using state-planted pine forests is a good example of a government-business joint venture to create a new export industry and new national wealth. Governments of both major political parties cooperated in capital formation, land use, hydroelectricity, roads, railroads, a modern port, and town construction. This long-term state commitment helped propel the industry toward large-scale vertical integration so that it could achieve economies of scale and scope and compete in world markets.