How the Economy Works
How the Economy Works · Years 10–12
Ngā Whāinga Akoranga · Learning Intentions
- Investigate a social, historical, economic, or political question using evidence
- Analyse multiple perspectives on complex social issues
- Understand how historical and contemporary forces shape society and identity
- Evaluate the relevance of Māori concepts and frameworks to understanding social issues
Paearu Angitu · Success Criteria
- I use at least two different sources or perspectives in my investigation
- I can explain how historical events or processes connect to present-day conditions
- I can present a clear position supported by specific evidence
- I connect at least one Māori concept or value to the social issue I am investigating
How the Economy Works
💡 From supply and demand to rangatiratanga economicsEvery decision you make — buying lunch, taking a part-time job, choosing a subject at school — is an economic decision. Economics studies how individuals, communities, and nations make choices under conditions of scarcity. Understanding the economy's mechanics is essential for anyone who wants to understand why prices rise and fall, why some communities are wealthy and others are not, and — critically — how iwi and Māori communities are building economic power on their own terms.
Part 1 — The Building Blocks: Core Economic Concepts
- Opportunity cost in your life: List three major decisions you or your family might make this year (e.g., going to university vs working, buying a car vs saving, renovating vs moving house). For each, identify the opportunity cost. Which decision has the highest opportunity cost? Why?
- Scarcity in te ao Māori: Land is the ultimate scarce resource in Aotearoa. Between 1840 and 1900, Māori landholdings went from nearly 100% of NZ (27 million hectares) to less than 4% (around 1.1 million hectares) through confiscation, sales under duress, and legal manipulation. Describe how the concept of "scarcity" was forcibly created for Māori. How does this historical context change how you think about "free market" economics?
Part 2 — Supply & Demand: How Prices Are Set
The following table shows the supply and demand for kūmara at the local kaumātua market in a given week.
| Price per kg | Quantity demanded (kg) | Quantity supplied (kg) | Market condition |
|---|---|---|---|
| $1.00 | 600 | 100 | |
| $2.00 | 480 | 200 | |
| $3.00 | 360 | 300 | |
| $4.00 | 240 | 400 | |
| $5.00 | 180 | 500 | |
| $6.00 | 120 | 600 |
- Complete the "Market condition" column — label each row as "shortage", "surplus", or "equilibrium" based on whether quantity demanded > supplied, < supplied, or = supplied.
- On the graph area below, plot the supply curve (Qs) and demand curve (Qd) with price on the y-axis (0–$7) and quantity on the x-axis (0–700 kg). Label both curves and mark the equilibrium point.
- A drought reduces kūmara supply by 30% at every price point. Create a new supply schedule in the table and find the new equilibrium price. By how much does the price change?
- The kaumātua market operates on koha (gift economy) principles for kuia and koroua — they receive kūmara at whatever price they can afford, with the shortfall covered by community donations. How does this modify the standard supply-demand model? Is a "koha equilibrium" economically rational? Why or why not?
Part 3 — GDP, Growth, and the Māori Economy
GDP (Gross Domestic Product) is the total value of goods and services produced in a country in one year. New Zealand's GDP is approximately $400 billion. The Māori economy (iwi assets + Māori business) is valued at approximately $70 billion and is growing at 4–5% annually — faster than the NZ average (2–3%).
| Sector | Māori % ownership | Estimated value ($M) |
|---|---|---|
| Fisheries / Aquaculture | 40% | $2,700 |
| Forestry | 34% | $5,100 |
| Agriculture (land-based) | 40% | $14,800 |
| Tourism | 8% | $3,200 |
| Property & Development | 12% | $8,600 |
| Energy | 15% | $4,200 |
| Other businesses | various | $31,400 |
- Calculate the total Māori economy value from the table. What percentage of NZ GDP does this represent? If the Māori economy grows at 4.5% annually, what will it be worth in 10 years?
- Which sector has the highest Māori ownership percentage? What historical or structural factors explain why Māori are strong in that sector but less represented in others (e.g., technology)?
- Beyond GDP: GDP measures the value of production but not wellbeing, equity, or environmental health. Māori economic philosophy (e.g., the te ao hou framework used by Ngāi Tahu) incorporates wellbeing indicators like wai ora (water quality), kaitiakitanga compliance, and cultural vitality. Design your own "Te Ao Māori Economic Dashboard" with 5 indicators beyond GDP. Justify each choice.
- Economic Justice: The Māori economy is growing faster than the NZ average, but wealth within the Māori population is unevenly distributed — a small number of iwi hold large assets while many urban Māori are in economic hardship. Describe this as an economist would, using the terms: inequality, distribution, structural barriers, and opportunity cost.
💡 Whakamutunga — Rangatiratanga Economics
The conventional economy was built without Māori consent and in many cases directly against Māori interests. But Māori are not victims of the economy — they are increasingly its architects. The growth of Māori economic assets from near-zero (post-confiscations) to $70 billion represents one of the most remarkable economic recoveries in global indigenous history. Understanding how economies work gives every young Māori person the tools to accelerate that recovery and shape what comes next.
Te wero: Research one iwi's economic strategy (suggested: Ngāi Tahu's "3 Peaks" strategy, Tainui's diversification, or Ngāti Porou's coastal economy). Write a one-page economic profile: sector focus, growth rate, distribution mechanism, and 5-year outlook.
🌿 Ngā Rauemi Hono — Related Resources
Hononga Marautanga · Curriculum Alignment
Level 3–4: Investigate how historical, political, and economic processes shape societies; understand how people participate in communities to create change; analyse different perspectives on social, cultural, and environmental issues.
Level 3–4: Gather, evaluate, and synthesise information from multiple sources; construct well-reasoned arguments using evidence; communicate social science understanding clearly in written, oral, and visual forms.
Tuhia ōu whakaaro · Write Your Thoughts
Reflect on your learning. What was the most important idea? What question do you still have?
Aronga Mātauranga Māori
Social Sciences taught well in Aotearoa should be uncomfortable — because the history of this land is one in which Māori and other communities have faced injustice, and in which those injustices are not yet fully addressed. Mātauranga Māori offers frameworks for thinking about social change that go beyond Western political theory: the concept of tino rangatiratanga (self-determination), of kotahitanga (unity in purpose), of utu (reciprocity across time) — these are not abstract ideas but working tools for analysing how power has been distributed and how it might be redistributed more justly. Social Sciences that centres these frameworks gives students the analytical vocabulary to name what they see in the world and imagine what could be different.
Ngā Rauemi Tautoko · Resources already provided
This handout is designed to be used alongside other resources in the same unit. Related materials are linked in the unit planner. All content is provided — no additional preparation is required to use this handout in your classroom.
📋 Teacher Planning Snapshot
Materials: This resource can be printed or used digitally. No additional materials required unless specified above.
Differentiation: Provide sentence starters or word banks for students needing scaffold support. Extend capable learners by asking them to research a real NZ example connected to this theme. Support ELL students with vocabulary pre-teaching. Offer entry-level and extension tasks to address a range of readiness levels.
Prior knowledge: Best used after the relevant lesson. Students with prior knowledge of systems and governance will access this more readily; no specialist prior knowledge is required for entry-level engagement.
Curriculum alignment
- Social Studies — Understanding: Students understand how systems thinking helps us analyse complex social, economic, and environmental challenges and identify leverage points for change.