As this edition of Quadrant reaches readers, I shall be making final preparations for The New Zealand Initiative’s fourth international business delegation. In late June, we will take more than three dozen senior New Zealand business leaders to the Netherlands. It continues our tradition of visiting small, successful economies to learn from their policy experiences.
Why should busy chief executives and board chairs spend a week examining Dutch water infrastructure, agricultural innovation, and regulatory systems? Because in our complex, competitive world, comparative learning is not a luxury but a necessity.
Nothing could be more urgent for Australia and New Zealand. Both nations are all too often too comfortable in their isolation, and too reluctant to measure themselves against the world’s best.
I am a great believer in comparing things, and my journey with comparative research began long before my time in New Zealand. My doctoral thesis was not merely interdisciplinary between law and economics. It was also comparative, contrasting Australian and German law. To make it even better, the subject was comparative advertising. It would be hard to fit in more comparison layers into a single thesis – but it prepared me well for my think tank career.
Having lived and worked in Germany, Britain, Australia and New Zealand, I have experienced firsthand how institutional environments shape economic outcomes. One notices things as an outsider that locals can take for granted.
As a German economist in New Zealand, I sometimes feel like an anthropologist who accidentally joined his own research subjects and never quite escaped. Conversely, an Australian or New Zealander living in Germany would notice peculiarities that I never questioned growing up there.
The Antipodes suffer from a peculiar geographical limitation. Both Australia and New Zealand benchmark themselves chiefly against each other or the broader Anglosphere. Our policy discussions regularly reference experiences from Britain, America and Canada, yet rarely venture beyond English-speaking countries.
We seem to exhibit a curious linguistic determinism in public policy: if it cannot be expressed in English, it probably is not worth knowing.
This self-imposed constraint robs us of valuable insights. When was the last time an Australian or New Zealand minister cited Danish education reforms, Swiss infrastructure funding, or Dutch regulatory models? Our political debates proceed as if non-Anglophone countries simply do not exist.
Meanwhile, small, advanced economies across Europe and Asia have forged ahead. They have developed innovative approaches to governance, education, infrastructure and regulation. Often with less favourable geography and fewer natural resources than Australia and New Zealand enjoy.
There is a world out there that we should know much more about. To address this gap, The New Zealand Initiative began organising international business delegations in 2017. We take senior business leaders to small, successful economies to learn directly through intense, week-long programmes of meetings and site visits.
Our first delegation visit took us to Switzerland in 2017. Our group included Christopher Luxon, then Chief Executive of Air New Zealand, who keeps mentioning his visit in his speeches as Prime Minister today.
Most striking was the extreme decentralisation of Swiss governance. In a nation smaller than Tasmania, 26 cantons and approximately 2,000 communes maintain remarkable autonomy – and even more remarkable governance efficiency.
This decentralisation challenged many of our members’ assumptions about economies of scale in government. The Swiss showed us that smaller political units can deliver better services with greater accountability. Their system of direct democracy and local fiscal responsibility creates a government both more responsive and more fiscally disciplined than our own.
We also discovered the Swiss dual education system, though it was not even on our agenda when we departed. This approach, which places equal value on academic and vocational training, produces remarkably low youth unemployment and a highly skilled workforce. It revealed how our own systems undervalue practical education and fail to create smooth transitions from school to work.
Two years later, we went to Denmark. This delegation visit offered different but equally valuable lessons.
The magnificent Øresund Bridge connecting Copenhagen with Malmö in Sweden embodied Denmark’s ability to execute complex infrastructure with remarkable efficiency. More striking was how Danish society has achieved consensus on long-term planning that transcends electoral cycles. No interminable inquiries or partisan point-scoring – just pragmatic problem-solving.
Denmark demonstrated that the size of government matters less than its quality and function. Here was a high-tax nation with an extensive welfare state that nonetheless maintained world-class infrastructure, dynamic businesses, and enviable living standards.
Given the choice between Denmark’s highly functional but larger state and New Zealand’s often dysfunctional but smaller one, the Danish experience made me question my prior assumptions. Well, at least the size of government is not the only thing that matters.
After a Covid-induced hiatus, we visited Ireland two years ago. There, we witnessed something entirely different. The country has transformed from one of Europe’s poorest to one of its wealthiest in a single generation.
Most striking was the pro-business mentality shared across Ireland’s political spectrum. Their Industrial Development Authority, tasked with bringing in foreign capital, enjoys political support impossible to imagine in Australia or New Zealand.
Foreign investment, so often treated with suspicion in our countries, is celebrated in Ireland as a source of prosperity. Irish politicians across party lines agree on the fundamentals of economic development. They have built a national consensus that transcends partisan divisions – a striking contrast to the perpetual policy reversals that plague Australia and New Zealand with each change of government.
Each of our visits – Switzerland, Denmark and Ireland – yielded specific policy insights and created lasting impact. For months after our return, the learnings from these delegations were the talk of the New Zealand business community. They shaped how we viewed our own country’s challenges and opportunities.
One tends to see one’s homeland with different eyes after such experiences.
More importantly, they demonstrate how much we miss by limiting our gaze to familiar shores.
Our Netherlands visit next month, our fourth such trip, promises similar revelations. I am particularly curious about their approach to large-scale infrastructure and water management. A country where much of the land lies below sea level has developed engineering and governance solutions of global significance.
The Dutch regulatory model also warrants close examination. Twenty years ago, faced with mounting bureaucracy, the Netherlands pioneered a radical approach: they began measuring red tape precisely. Using their so-called Standard Cost Model, they calculated the cost of each regulatory requirement—tracking hours spent, wage costs, and affected businesses. This turned the abstract concept of “regulatory burden” into concrete numbers that could be measured and therefore managed.
What followed was remarkable. The Dutch government set a target to reduce administrative costs by 25% within four years – and achieved it, eliminating nearly €4 billion in annual compliance costs. More importantly, they established institutional machinery to maintain momentum, including an independent watchdog that scrutinises all new regulations.
While Australia and New Zealand have made periodic attempts at regulatory reform, neither has adopted the rigorous measurement approach pioneered by the Dutch. Both countries have preferred principles and processes over hard targets and accountability. The results speak for themselves: both Australia and New Zealand have steadily declined in global rankings for regulatory quality and competitiveness.
Both Australia and New Zealand need more systematic benchmarking against the world’s best, not just those who speak our language. Our governments should regularly examine how their policies compare not just with each other but with Switzerland, Denmark, Singapore and the Netherlands.
Academic research demonstrates the value of such comparative learning. But sometimes, you also need to see it for yourself, which is what our delegation visits are all about.
Critics might argue that different countries have different contexts, making direct policy transfer impossible. But this argument mistakes the purpose of comparative learning. We do not simply copy what works elsewhere; we understand principles that might apply differently in our own environment. We expand our imagination about what is possible.
The greatest risk for Australia and New Zealand is not that we might blindly adopt inappropriate foreign models. It is that we might never encounter the ideas that could transform our nations for the better.
As I prepare for Amsterdam, I am reminded of the Dutch Golden Age—a period when this small European nation became a global commercial and cultural power through openness to the world. And, in a way, that is the idea I hope we will get out of our visit to the Netherlands today.
Who knows what lessons we will learn in the Netherlands that will shape our thinking for years to come. Sometimes, the most valuable insight will emerge from an unexpected corner, as Swiss dual education did for us in 2017.
The great Argentine writer Jorge Luis Borges once described paradise as ‘a kind of library.’ For nations seeking better futures, paradise might be a kind of policy library – one that contains volumes in many languages, not just English.
Australia and New Zealand have been avid readers of a very limited collection, repeatedly checking out the same familiar books while ignoring entire wings of valuable knowledge. It is time we ventured into those neglected aisles and discovered what they have to offer. After all, the ideas that will transform our nations may be written in languages we have yet to learn.
To read the full article on the Quadrant website, click here.