A More Productive Australian Economy

Parham, Dean

doi:10.22459/ag.07.01.2000.01

Cited by 3 publications

(4 citation statements)

References 2 publications

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“…These improvements are likely to reflect the effect of better resource allocations (input mix) in response to relative changes in factor prices.) Parham (2000) showed that Australia experienced acceleration in productivity growth in the 1990s which is consistent with the figures in Table 3. Parham (2004) estimated trend multifactor productivity for 12 industries, which showed multifactor productivity increases were greatest in the utilities and communications sectors through both the 1980s and 1990s.…”

Section: Sectoral Productivitysupporting

confidence: 86%

Productivity and Economic Growth in Australia, New Zealand and Ireland

Margaritis¹,

Scrimgeour²,

Cameron³

et al. 2005

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t is generally accepted that productivity growth is a major source of economic growth and welfare improvement. Labour productivity has accounted for roughly half of the growth in per capita GDP in the OECD over the last two decades, with the other half primarily accounted for by increases in labour utilisation, that is, changes in the demographics, unemployment and labour force participation rates. For this reason, productivity is of vital interest to economists and policymakers. An understanding of technical and efficiency change, two key factors in productivity growth, is thus important in policy decision-making. Academics and policy makers continue to debate the relative contributions of shocks and policy changes impacting on population growth, capital accumulation, microeconomic behaviour and technological advance. Different policy settings impact on both aggregate performance and the productivity of sectors and factors. This paper presents an analysis of the relative growth performance of Australia, New Zealand and Ireland concentrating on the underlying components of labour productivity, particularly efficiency change and technical change. Such analysis is important to policy decisions of countries seeking to improve their relative international position and outlook. It is important that policymakers identify sustainable productivity changes (largely driven by technological change) separately from measured productivity change. This separation facilitates assessment of the extent to which technology adoption and diffusion contribute to a productivity catch-up. This work is similar in many respects to recent studies undertaken by the OECD (2004a), but with important methodological differences introduced by Margaritis, Färe and Grosskopf (2005). The individual contributions of industry productivity growth and sectoral composition to aggregate productivity are also considered. The novelty of the productivity measurement and analysis used by Margaritis, Färe and Grosskopf is that it 'derives from a decomposition of the growth in labour productivity in terms of (a) technical change both neutral and biased, (b) efficiency change, and (c) capital accumulation'. Each component's contribution to the growth in labour productivity can then be assessed. The paper proceeds as follows. We outline the relative economic growth performance of Australia, New Zealand and Ireland over the period 1979-2002,

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Section: Sectoral Productivitysupporting

confidence: 86%

Productivity and Economic Growth in Australia, New Zealand and Ireland

Margaritis¹,

Scrimgeour²,

Cameron³

et al. 2005

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“…In practice, the comparison is biased in favour of the expansion that followed the deepest contraction, namely that of the 1990s. Parham (2000) relies primarily on the ABS productivity cycles in his formal analysis. However, his graphical presentation of the data is biased in favour of the hypothesis that performance has improved in the 1990s.…”

Section: Multifactor Productivity Estimatesmentioning

confidence: 99%

“…However, his graphical presentation of the data is biased in favour of the hypothesis that performance has improved in the 1990s. A peak-to-peak trend for the 1970s is compared with a peak-to-trough trend for the 1980s and a trough-topeak trend for the 1990s, as shown in Figure 3 from Parham (2000), reproduced below as Figure 1. The effect is to bias the trend growth line downwards for the 1980s and upwards for the 1990s.…”

Section: Multifactor Productivity Estimatesmentioning

confidence: 99%

“…Figure 2a, from Parham (1999) shows a clear structural break in the relationship after 1990-1. Figure 2b, from Parham (2000) is also drawn to show a structural break, but casual inspection suggests the alternative hypothesis of a linear trend over the period 1974-2000, with no structural break apart from the secular decline at the end of the 'golden age'. Statistical evidence on this point is indecisive.…”

Section: Multifactor Productivity Estimatesmentioning

confidence: 99%

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2001

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A ustralia's major political parties have generally been held to be private associations of political activists who freely determine their own activities. As such, they should not be subjected to government regulation. The scrutiny of their behaviour is a matter for their members and the electorate should only assess the parties' public performance. However, and more recently, the parties have developed into professional machines with head offices and organisers, and they receive funds from the taxpayer and from sources other than their members. In these regards, the parties have a degree of freedom from the membership by way of professional advice and non-member sources of funds. Furthermore, the parties' status has changed to the point where their historyideological, a large membership presence in the electorate and self-supportingbelies their current role. The present parties are brand names with a nominal membership presence in the electorate, where the market for political activism has shifted to interest groups and where they are heavily supported by the state. For example, Gary Gray (1997), the former national Secretary of the Australian Labor Party, estimates a third of all funds available to the ALP comes from taxpayers. The new status of registered political parties is semi-public. Ideally, then, they should be beholden to the public, both electorally and in a more direct proprietorial way, as well as to their membership. The issue is to decide the regulatory mix that would preserve free political association and satisfy the taxpayer's investment.The way these questions are addressed depends on the extent to which the party system relies on public trust. For example, the British parties are subject to a minor degree of regulation and almost no scrutiny. This is because the argument that parties 'are an essential part of civic society and the state should be kept at a distance' (Seyd, 1988:204), has won the day. The sentiment was elegantly put in a report (Houghton, 1976:75) on public funding, 'we think it mistaken and possibly dangerous to suggest that any work can be required of a political party-by the State, by Parliament or by anyone other than its members'. Further, '(d)irect state aid would breach the established British constitutional practice that organisation for political ends is a strictly voluntary activity' (Houghton, 1976:78). It appears that British political life will remain 'based strongly on trust' (Oliver, 1997:543). Is Australian political life, specifically those parts run by the parties, based strongly on trust? Do the voters trust the competition between the parties as a sufficient form of regulation or do they require as well, scrutiny of the internal operations of the parties?

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The Australian Productivity Miracle: A Sceptical View

Quiggin¹

2001

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A More Productive Australian Economy

Cited by 3 publications

References 2 publications

Productivity and Economic Growth in Australia, New Zealand and Ireland

Productivity and Economic Growth in Australia, New Zealand and Ireland

Untitled

The Australian Productivity Miracle: A Sceptical View

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