I checked around a bit this morning for where the term "The Gnomes of Canterbury" originated. Best I can reckon, it's this Bruce Jesson article from Auckland Metro, August 1986.and
He [Jesson] then lists the formidable opponents of the "Treasury View", primarily centered at Victoria University but also at Massey and Auckland. Treasury supporters, on the other hand, are found at one place above all:Yes there were many Canterbury grads up in Wellington at the time. Canterbury was probably the econ department with the strongest support for the 1980s reforms. Many of the then staff were free market supporters, something rather odd for economics departments in New Zealand at the time.Support for the Treasury approach is concentrated at Canterbury where Professor Richard Manning, Labour Party adviser and Reserve Bank appointee, is the intellectual authority. Many Treasury officials are Canterbury graduates, which means that government policies are dominated by the thinking of a particular university department.The article is consequently titled "The Gnomes of Canterbury".
Manning taught most of the third year microeconomics course when I did it. This was his last year at Canterbury before departing for the US. Sadly Manning died not long after he went to the States. It was the loss of one of New Zealand's best economists.