Asia's transformation into the world's most dynamic economic region has been a defining development of our time. The pace and scale of its rise have been nothing short of staggering.
That's the story according to Julia Gillard's white paper on the Asian century, and it's right.
"Over the past 20 years, one third of the world's population has re-engaged with the global economy and more are set to do so," the paper says. "Living...
Saturday, November 3, 2012
Thursday, November 1, 2012
GETTING PEOPLE TO DO THEIR JOB WELL
Talk to Jobs Australia National Conference, Manly, Thursday, November 1, 2012
The last time I spoke to your national conference, many moons ago, I offered some confident predictions about the outlook for the labour market. It seemed to go down quite well, but turned out to be hopelessly wrong. So this time I propose to do something quite different, something more philosophical, something I haven’t done before, even something...
MAIN STREET & WALL STREET: the interrelationship between the real and financial economies
Comview conference, Melbourne, November 2012
Last year Glenn Stevens remarked that it was ‘very sensible of Australian households to be strengthening their balance sheets’. What on earth did he mean? In recent years we hear a lot of jargon in the economic debate that we usen’t to hear and that certainly wasn’t mentioned when we were at university. People keep on about ‘balance sheets’ - household balance sheets, business balance...
Macquarie University IR Panel Discussion
I want to make four points very quickly. First, I’m not convinced we have an economy-wide problem with productivity - I don’t think the statistical evidence bears that out.
Second, I don’t believe we have a nation-wide problem with unreasonable unions exploiting an IR system that a Labor government has stacked in their favour, if for no other reason than that the great majority of employers, and the great majority of employees,...
Wednesday, October 31, 2012
White paper shows way to Asian century
When governments make grand policy unveilings, as Julia Gillard has with her white paper on the Asian century, it’s terribly tempting for people in jobs like mine to sit back and criticise. After all, unlike you and me governments tend to be less than perfect.
If you’re disposed to criticise, there’s never a shortage of material - particularly if you’re prepared to offer mutually inconsistent criticisms, or shift your angle...
Monday, October 29, 2012
It's better to honour budget commitments
Those economists who’ve joined the smarties in proclaiming Julia Gillard’s seeming resolve to get the budget back to surplus this financial year to be purely political and of no economic merit are revealing how little they know about political economy - the politics of economic policy.
They don’t understand the vital role faithful adherence to ‘frameworks’ has played in giving Australia it’s widely envied record on fiscal (budgetary)...
Saturday, October 27, 2012
How the budget redistributes income
In a capitalist economy such as ours, the rich have loads of money, the poor have next to none and the government does little about it.
Is that what you suspect? It's a long way from the truth. While some (including me) may argue they could be doing more, between them our governments - federal and state - are doing a lot more to redistribute income from the rich to the poor than many people imagine.
The reason so few people...
Wednesday, October 24, 2012
Budget redistributes income over life cycle
Listening to all the argy-bargy over the budget update makes you think - what strange things budgets are. The government spends all this money - hundreds of billions a year - but where does it come from? From us, of course. The politicians use the budget to take money from us with one hand, then give it back with the other.
They have one set of public servants to take our money from us and another to give it back. What's the...
Monday, October 22, 2012
Business cons the states out of tax revenue
WHEN we see the mid-year budget review today, all eyes will be on the savings Wayne Swan will announce to ensure he still achieves a surplus this financial year. The measures will be needed because the weakness in tax collections is even greater than expected.
Deciding how much we should cut spending is one thing, but working out what to do about the budget's structural problems on the revenue side is quite another.
One way...
Saturday, October 20, 2012
Game theory can be practical
Children play games. Teenagers play video games. Footballers play games. Economists don't admit to playing games. They prefer to say they study game theory.
This week two academic gamesters, the economist Alvin Roth, of Harvard Business School, and the mathematician Lloyd Shapley, of the University of California, Los Angeles, were awarded the Nobel Prize in Economics for their efforts.
This brought to 10 the number of academics...
Wednesday, October 17, 2012
Psst. Don't tell anyone about poverty
It's remarkable that, despite all the effort and expense the government goes to in measuring gross domestic product, it doesn't run to the modest extra expense of measuring poverty. But this being so, it's hardly remarkable the media and the public pay far more attention to the gyrations of GDP than to the extent of poverty.
Why the lack of official interest in such a basic measure of how we're doing as a nation? Because, in...
Monday, October 15, 2012
Reserve Bank moves to Plan B on interest rates
IT'S not at all clear that falling commodity prices - or the Reserve Bank's latest cut in the official interest rate - will lead to a lower Aussie dollar. But if it doesn't fall, and the economy doesn't look like it will stay growing at its trend rate, the Reserve will just keep cutting rates.
The best way to think of the Reserve's problem in using monetary policy (interest rates) to maintain non-inflationary growth is that...
Saturday, October 13, 2012
Labour market can be flexibile as well as fair
If you listen to business, we still have big problems with the labour market. John Howard deregulated it, but then Julia Gillard re-regulated it and now we can't do a thing with it.
The business people are right to this extent: particularly at a time when the economy is under so many pressures for change in its structure - the rise of the emerging market economies and the resources boom it has produced, the digital revolution,...
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