Economic Development and Technological Change in Rural Australia: Some Critical Policy Issues

Abstract

The paper discusses the status of the rural economy in Aus­ tralia, emphasizing that agriculture, and primary industry in general, have historically played a dominant role in national economic development and have occupied a prime position in general economic policy. In this context, rural develo ment policy in Australia has consisted mainly of measures to expand agricultural production through a pattern of capital­ intensive technological change aimed at minimizing labor in­ puts and maximizing land-labor ratios. While leading to vety high levels of labor productivity, this approach has failed to prevent the wider rural economy from deteriorating in many communities. It has also been accompanied by a deteriora­ tion in the overall economic performance of the agriculture sector itself, despite continued improvements in certain po ularly quoted agricultural indicators (such as gross physical production). The paper argues that Australia's rural policies andprograms have not taken adequate account ofstructural changes in the national and international economy. It con­ cludes that improvements in the rural economy will require a new approach which includes: (1) the replacement of "growth in agriculturalproduction• as the main focus ofrural policy by a new paradigm concerned with "integrated rural development"; and (2) a new emphasis on technology policy as a tool for ensuring that the pattern of technological prac­ tice in agriculture and other rural industries is developed to fit properly the underlying economic conditions.