The results of the vigorous application of free market policies to the New Zealand economy has left much confusion, handwringing and outright dishonesty in their wake. Those who are ideologically committed to increasing state and union intervention in the economy have left no statistic untwisted in their goal of discrediting the free market. Their tactic has been the simple one of unfavourably comparing New Zealand's economic progress with Australia's. According to Belchamber, these comparative growth rates are beyond dispute. The statistics are not only disputable they are false.
Growth means lengthening the capital structure by adding more and more complex stages to it.
This is what is really meant by the process of capital accumulation. The faster the rate of accumulation, the higher real living standards will be. Though this process clearly occurred in Asia in the 80s, nothing of the kind happened in Australia during the same period. What happened was that the Labour government used a rapidly expanding money supply to reduce the cost of labour relative to the value of its product and so induce more employment. As labour and capital are complementary factors, the policy had the effect of bringing idle capital' into use.