In 1984, the highly interventionist New Zealand economy was struggling. Between 1974 and 1984, inflation was 11-17% (dropping to 7% in 1983 after wage and price freezes), the deficit was 3-9% of GDP, and real GDP growth averaged 1% per year. In 1984, unemployment was at a historic high of 5%, and there was an imminent foreign exchange crisis. ‘Rogernomics’ refers to the sweeping free-market reforms enacted by the new government elected in 1984. By 1987, government spending had decreased from 44% to 37% of GDP, the highest rate of income tax was cut from 66% to 33%, corporate tax was cut from 45% to 33%, a goods and services tax of 10% was introduced, generous agricultural and industrial subsidies were removed, the New Zealand Dollar was devalued then floated, import licences were abolished and tariffs cut, and many state-owned enterprises were privatised.