Public Sector Reform in New Zealand and Its Relevance to Developing Countries

Does New Zealand's success story have lessons for developing countries contemplating public sector reform? That question usually elicits one of two reactions, both inadvisable in the authors' view. The first reaction is to be impressed with the efficacy of the reforms and conclude that they should be adopted uncritically in other countries. The second reaction is that the special conditions existing in New Zealand are such that none of its reform experience is relevant to others. The authors take a middle position, maintaining that poorer countries can indeed extrapolate from the experience of their higher income neighbor despite the different conditions under which they have to operate. New Zealand's comprehensive overhaul of its public sector affords both general principles and specific elements relevant to countries looking to improve the quality, efficiency, and cost effectiveness of their public service sectors, and a careful analysis of those reforms can ascertain what might be transferable and what principles might apply.