Anatomy of a new economy

A new economic model incorporating Māori values of inclusive prosperity and wellbeing could transform New Zealand, says Mānuka Hēnare.

A new model of economics and business is beginning to emerge in Aotearoa-New Zealand that combines the best of Māori and Western economic thinking, says Associate Professor Mānuka Hēnare, Director of the Business School's Mira Szászy Research Centre for Māori and Pacific Economic Development.

He says that when Europeans arrived in the early 19th century, the settler market economy of exploitation and capital clashed with a dynamic indigenous market economy of mana (he whenua rangatira), or inclusive prosperity and wellbeing. One had its roots in English feudalism; the other in Island Southeast Asia, Austronesia and the Pacific.

The indigenous economy, which was prosperous up until the 1820s, was systematically dismantled through the second half of the 19th century and the country's assets redistributed amongst the new settlers. The economy has since appeared invisible to historians and economic theorists, and is only now being given the attention it deserves, says Associate Professor Hēnare.

Built in to the Māori collective way of life, or Māoritanga, are four 'wellbeings': spiritual, environmental, whānau-kinship, and economic wellbeing. And from this understanding of wellness, a new economic equation can be developed, which has different ways of measuring economic and social success, he says.

"Princess Te Puea, Apirana Ngata and other Māori leaders of the early 1900s tended to refer to Māoritanga in terms of a struggle for cultural survival. They seemed to implicitly accept that we were the labourers in someone else's economy. It is very hard to find detailed discussion on the nature of the Māori economy right up until the 1970s."

Hēnare says a great deal of work is now being done on translating the wellbeings of Māoritanga into forms of capital.

"New Zealand has wonderful spiritual capital, but we don't recognise it because we like to separate religion out of any discussion of social policy. Environmental capital, in terms of ecology care, environmental economics and nature capital, is very big at the moment. Human capital, for Māori, takes the form of a kinship system and here we look at investment in terms of education and preparing people for life in the context of production and consumption. And socio-cultural capital is particularly strong – especially in Auckland as a result of the mix of different cultures in the city. Finally, there is economic capital, including land, finance, knowledge and resources."

A problem for Māori businesses, in terms of economic capital, is that they tend to follow conventions, and intangibles are very rarely registered in financial audits – not because it is illegal to do so, but because accountants and others find it too hard.

"The material world always wins out, and that has made a lot of Māori entities anxious about their sacred hills and streams and other things which to them are assets."

He says that because Māori never went through the negative aspects of European-style Enlightenments, particularly the English Enlightenment, where tradition and history was taken out of the equation and parked in a category called "antiquity", their focus is not limited to the world they were attempting to create. Even the life-force, once attributed to the divine will of God, for Europeans became a biological – and therefore a material – life-force. It was, he says, a way of keeping religion out of a discussion about the material world.

"But Māori persist in saying that the life-force – the mauri – is independent of the thing itself and determines its nature."

These, and a large number of other "moral sentiments" ­– to use Adam Smith's phrase – form the matrix in which Māori make moral decisions, says Hēnare. This is important, he says, because as the Hungarian political economist and social philosopher Karl Polanyi noted, the market is embedded in a society, and reflects its spirituality, ethics and values. He says that this has been the case for 6000 years and people are re-evaluating Polanyi's work in the light of the pervasive influence of centre and far-right doctrine that the market has its own values and is independent of society.

"Historically, humans have always put the market in society and it has been driven by the values of society. That is still the position of Māori, who believe that the market must serve the interests of the cosmos, the natural world, the human world and the divine will."

Such insights, he says, have enormous potential to transform our notions of economic activity.

Associate Professor Mānuka Hēnare spoke on 'Adam Smith and Māori' as part of the University of Auckland's Winter Lectures 2014.

Watch his presentation here 

Mānuka Hēnare

Mānuka Hēnare is Associate Professor of Māori Business Development in the University of Auckland Business School's Department of Management and International Business.

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