One of the big problems with the New Zealand economy is the lack of R&D spending, which restricts innovation and hamstrings our future. But when you look at the statistics, its not the government's fault - our government spend about the same as Japan's (as a proportion of GDP) on R&D. The failure is on the part of our business community, who spend less than any other developed nation.
But not all businesses. This chart, from the a government presentation on Achieving New Zealand's Economic Potential: Exploiting International Opportunities by Harnessing our Strengths, points out who the real culprit is:
Our small businesses spend about the same proportionately as those in Ireland or Australia. Our big businesses OTOH, spend only a third as much. Our innovation problem basically boils down to the short-term thinking of our business "leaders", who prefer to asset-strip rather than invest.