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Depression & Recovery in Western Australia, 1929--1939. A Study in Cyclical & Structural Change
... From 1788 Australian society, like all open societies, became obsessed with wealth and progress, and with recording their material achievement. From that time it was possible to estimate the extent of Australia's wealth and the pace of its material progress -a task undertaken by a long line of pioneering Australian statisticians and historical economists, such as W.C. Wentworth (1819 and1821), Timothy Coghlan (1886Coghlan ( -1902, J.T. Sutcliffe (1926), Stanley Carver (1927), F.C. Benham (1928), Colin Clark and J.G. Crawford (1938), Noel Butlin (1962;1986), Graeme Snooks (1972;1974;, Gus Sinclair (1988;, and Bryan Haig (2001). ...
... From the late 1880s to the late 1930s, the manufacturing sector's share of GDP increased from 11 to 18 percent, the rural sector's share declined from 23 to 20 percent, and services fluctuated around a flat trend of about 30 percent. Of lesser significance was a technologically, and sometimes publicly, led transfer within the rural sector from pastoral to arable farming (Snooks 1974). This was the beginning of what I call the 'paternalistic technological substrategy', which eventually emerged, in the early years of the twentieth century, to replace the earlier 'dependent technological substrategy'. ...
... Population grew at only half the rate (1.6 % pa) of that (3.4 % pa) in the previous period following the gold rushes. The market economy was unable to provide the opportunities for a continuous and rapid inflow of population during a period in which: sound natural resource margins had been exceeded; foreign trade was no longer an effective engine of growth owing to the precariousness of the world economy; 'protection all round' raised the costs of trade with the rest of the world; and economic expansion was badly punctuated by a series of major wars, depressions, recessions, and droughts (Schedvin 1970;Snooks 1974;Sinclair 1976). And as the market sector was unable to provide opportunities for a much larger population, the feed-back effects from the household economy to the private sector -especially via residential construction -were much less than in the second half of the nineteenth century. ...
This essay attempts to quantify and explain the economic performance of Australia from the first European settlement to the present, and beyond. A general dynamic theory—the ‘dynamic-strategy’ theory—has been employed to provide a new interpretation of ‘dynamics Downunder’. It is shown, among other things, that the bold attempt from the 1910s to the 1960s to turn aside from the traditional development policy of exogenously driven natural-resource exploitation in order to embark on an endogenously determined dynamic process, has broken down during the course of the present generation. This was mainly due to a failure of ‘strategic leadership’ on the part of recent Australian governments that have, quite rightly, dismantled the framework of protection but have failed to replace it with the infrastructure of strategically relevant technological ideas. Once again Australia's economic prosperity depends heavily on the fluctuating fortunes of the global economy. While in the nineteenth century this took the form of reliance on the prosperity of Britain, today it centres on the continuing growth of Japan and China. This critical problem has been exacerbated by the misconceived policy of inflation targeting, which is damaging the central endogenous dynamic mechanism. What then of the future? It all depends on whether strategic leadership can ever be rediscovered, and a new dynamic economic strategy be adopted. This paper was subsequently published in ECONOMIC PAPERS. A JOURNAL OF APPLIED ECONOMICS & POLICY, 2008 (27/3: pp. 208--32).
... From 1788 Australian society, like all open societies, became obsessed with wealth and progress, and with recording their material achievement. From that time it was possible to estimate the extent of Australia's wealth and the pace of its material progress – a task undertaken by a long line of pioneering Australian statisticians and historical economists, such as W.C. Wentworth (1819 and 1821), Timothy Coghlan (1886–1902), J.T. Sutcliffe (1926), Stanley Carver (1927), F.C. Benham (1928), Colin Clark and J.G. Crawford (1938), Noel Butlin (1962; 1986), Graeme Snooks (1972; 1974;, Gus Sinclair (1988;, and Bryan Haig (2001). Their work has been given global perspective in the breathtaking estimates and analysis of Angus Maddison (1995; 2003). ...
... From the late 1880s to the late 1930s, the manufacturing sector's share of GDP increased from 11 to 18 percent, the rural sector's share declined from 23 to 20 percent, and services fluctuated around a flat trend of about 30 percent. Of lesser significance was a technologically, and sometimes publicly, led transfer within the rural sector from pastoral to arable farming (Snooks 1974). This was the beginning of what I call the 'paternalistic technological substrategy', which eventually emerged, in the early years of the twentieth century, to replace the earlier 'dependent technological substrategy'. ...
... Population grew at only half the rate (1.6 % pa) of that (3.4 % pa) in the previous period following the gold rushes. The market economy was unable to provide the opportunities for a continuous and rapid inflow of population during a period in which: sound natural resource margins had been exceeded; foreign trade was no longer an effective engine of growth owing to the precariousness of the world economy; 'protection all round' raised the costs of trade with the rest of the world; and economic expansion was badly punctuated by a series of major wars, depressions, recessions, and droughts (Schedvin 1970; Snooks 1974; Sinclair 1976). And as the market sector was unable to provide opportunities for a much larger population, the feed-back effects from the household economy to the private sector – especially via residential construction – were much less than in the second half of the nineteenth century. ...
This essay attempts to quantify and explain the economic performance of the Great South Land – later called Australia – from the first migrations some 60,000 years ago to the present, and beyond. A general dynamic theory – the ‘dynamic-strategy’ theory – has been employed to provide a new interpretation of ‘dynamics Downunder’. It is shown, among other things, that the bold attempt from the 1910s to the 1960s to turn aside from the traditional development policy of exogenously driven natural-resource exploitation in order to embark on an endogenously determined dynamic process, has broken down during the course of the present generation. This was mainly due to a failure of ‘strategic leadership’ on the part of recent Australian governments that have, quite rightly, dismantled the framework of protection, but have failed to replace it with the infrastructure of strategically relevant technological ideas. Once again Australia’s economic prosperity depends heavily on the fluctuating fortunes of the global economy. While in the nineteenth century this took the form of reliance on the prosperity of Britain, today it centres on the continuing growth of Japan and China. This critical problem has been exacerbated by misconceived monetary policies that are damaging the central endogenous dynamic mechanism. What then of the future? It all depends on whether strategic leadership can ever be rediscovered.
This paper investigated the impact that an expansion in agricultural processing would have
on the Western Australian economy by developing and applying a Computable General
Equilibrium economic model of Western Australia (called WAM). WAM was used to simulate
the effects of a $1 million expansion in eight agricultural processing industries.
In addition, based on a review of the literature and two case studies, impediments to
agricultural processing in Western Australia were identified.
The results show that agricultural processing produces a range of positive impacts. On
average, a $1 million expansion in agricultural processing is estimated to increase the State’s
GSP (Gross State Product) by $649,000, and total output by $1.9 million. The expansion of
the Wine and spirits industry is estimated to have the largest impact, while the Textile fibres,
yarns and woven fabrics industry has the least beneficial effect on the Western Australian
economy.
The study identified several factors that hinder the expansion of agricultural processing in
Western Australia. Inefficient support mechanisms and industries, strict marketing and
quarantine regulations, and costly and inadequate supplies of raw materials are the major
impediments. It appears that, if essential logistic and institutional supports are made
available, the WA food processing industry has the potential to expand rapidly, even with its
small local market and less competitive supply of raw materials. In the absence of adequate
private sector investment, the public sector needs to play an important role in developing and
implementing appropriate policies so that barriers to private sector investment and
agricultural processing are removed.
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