Economic rationalism: The nature, influence and impact of the doctrine over the last decade in Australia

Abstract

Abstract This paper discusses the theoretical basis of economic policy-making in Australia and the social effects of its implementation over the last decade. The first section is concerned with a review of the historical background to the two main competing schools of contemporary economic thought: non-interventionist and interventionist. The economic basis of the doctrine of economic rationalism is discussed in order to gain an appreciation of its appeal to, and its popularity with, contemporary policy-makers. Next there is an exploration of the widespread acceptance of the doctrine in the 1980s followed by statistical data on the social impact of policy implementation over the last decade in Australia. Critiques of economic rationalism in the 1990s are reviewed along with the counter defence. Finally the challenge to promote social values in economic policy-making is discussed.