Jacinda Ardern, who is to become the nation's youngest leader since 1856, said measures used to gauge economic success "have to change" to take into account "people's ability to actually have a meaningful life".
The 37-year-old will take office next month after the populist New Zealand First party agreed to form a centre-left coalition with her Labour Party. They will be supported by the liberal Greens.
In her first full interview since becoming prime minister-elect, she told current affairs programme The Nation that capitalism had "failed our people".
"If you have hundreds of thousands of children living in homes without enough to survive, that's a blatant failure," she said. "What else could you describe it as?"