Growth In Australia Research Articles

Role of financial development in economic growth in the light of asymmetric effects and financial efficiency

AbstractThe growth effects of financial development might be asymmetric and nonlinear according to the level of financialization of countries. As a corollary to this notion, in the subject study, we developed a three‐regime threshold autoregressive distributed lags (TARDL) model, which allows us to accommodate the asymmetric effect of financial development on economic growth in top 10 financially developed countries. We augmented the TARDL model by including trade openness, capital formation and labour as potential determinants of economic growth. The empirical findings revealed the existence of threshold asymmetric co‐integration between variables. In particular, in the upper regime, financial development boosts economic growth in Singapore while it exerts a negative impact on economic growth in Finland. In the middle regime, financial development increases economic growth in Australia and Singapore. However, in the lower regime, financial development hampers economic growth in the US, Malaysia and Singapore. Trade openness has a positive long‐run influence on economic growth in Canada, South Africa, Australia, Malaysia, New Zealand, Singapore, Finland and Norway. Capital formation strengthens economic growth in the US and Malaysia in the long‐run. Labour is found to sustain economic growth in the long‐run for Malaysia and Singapore. The dynamic multipliers which depict the response path of economic growth to a one‐unit shock of financial development in the three regimes highlight the discrepancies in the reaction of economic growth to financial development shocks occurring in different regimes. Important policy implications can be instigated from the empirical results.

An Analysis of the Effect of the Superannuation Guarantee Levy on Wage Growth in Australia

Australia introduced the Superannuation Guarantee Levy (SGL) in 1992 as a major component of the retirement system. The SGL system requires employers to make contributions to an approved superannuation fund on behalf of employees as a percentage of wages with the contribution rate being gradually increased over the period 1992~2014. Using multi-factor regression and a methodology founded in Power Resources theory, we find there is evidence that the low real wage growth in Australia has been correlated with the increases in the SGL. The paper has important implications for the Australian Government given the intention to raise SGL contributions further in 2025 and the impact that such a change will have on wages, on SGL accumulations (Stanford 2017) and on the net costs of the superannuation system taxes and transfers (Evans and Razeed 2018).

An Analysis of the Structure of Trade Between Australia and China: An Australian Perspective

Abstract The structure of exports from Australia to China reveals the dominance of primary products with the structure of imports from this country reflecting the over-reliance on manufacturing goods. This has restrained and led to fluctuations in the balance of trade surplus in Australia thereby leading to lower than otherwise and more volatile output and employment growth. The pattern of trade between Australia and China is representative of trade between Australia and the rest of the world thereby magnifying these adverse effects. Strategic trade policy has the potential to alleviate these negative effects on output and employment growth in Australia.

Non‐Standard Employment and Wage Growth in Australia

AbstractUsing data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey, and after restricting attention to employees, we observe an increase over time in the non‐standard employment share, all of which is concentrated in the period since 2009. Further, we find clear evidence that employees in non‐standard forms of employment have experienced relatively low rates of growth in hourly wages when compared with permanent full‐time employees. Nevertheless, decomposition analysis suggests that changes in workforce composition by employment type have had a very small (and insignificant) impact on the overall rate of wage growth in recent years.

The prevalence, severity and experience of food insecurity in Australia: An investigation of food aid use.

High costs of living and low wage growth in Australia have resulted in an increase in the number of people experiencing food insecurity, and a corresponding increase in the number of people accessing food aid. This research employs qualitative methods alongside standard methods to explore food security to investigate these issues in food aid settings in Victoria, Australia. The two aims of this study were, 1) to explore the profile of people who access food aid and 2) to explore the experiences of people accessing food aid. A convenience sample of people was recruited from organisations that distribute food aid from across the state. People in need of food aid typically self-refer to charities, who then apply varied and localised criteria to manage access to the charitable service. Interviews were conducted with 78 participants between June 2018 and January 2019. Participants had been accessing food aid for 4years on average (SD 5.7, range 1month-40years), most participants were female (n=57, 73.1%), with an average age of 52.6years (SD 15.9), and over half were born in Australia (n=44, 56.4%). Most participants were in receipt of a government welfare payment (n=75, 96.2%), and over 40% were living in private rental accommodation. Around two thirds of participants reported low or very low food security (n=54, 67.5%). Participants reported a range of both positive and negative experiences accessing food aid. This study adds to the body of literature exploring food insecurity in high-income settings and its persistence despite significant national economic prosperity. Current economic and political conditions in Australia mean that the reliance on food aid by welfare recipients is unlikely to decrease.

Widening inequalities in premature mortality in Australia, 2006-16

Background Increases in Australia’s life expectancy have slowed since 2003. Within this context, it is important to analyse whether socio-economic and geographic inequalities in premature mortality have changed in recent years.
 Aim The aim is to measure the extent of and change in inequalities in premature mortality (under 75 years) by area socio-economic status and remoteness in Australia from 2006-16.
 Data and methods This study uses Australian death registration data from 2006-16. We identify area socio-economic quintile (Q1 lowest to Q5 highest) and remoteness (major cities, inner regional, outer regional/ remote/very remote) for each decedent. Age-standardised death rates (ASDR) at ages 35-74 and 0-34 years are calculated and smoothed over time.
 Results ASDR decline at ages 35-74 years has slowed markedly, and from 2011-16 Q1 ASDRs stagnated. The Q1:Q5 ASDR ratio for females rose from 2011-16 for males (1.97 to 2.11) and females (1.78 to 1.98), and also widened in the Q2:Q5 and Q3:Q5 comparisons for females. ASDRs outside major cities stagnated from 2011-16 and inequalities compared with major cities widened to be 40% higher in 2016. ASDR declines at 0-34 years were quicker than for 35-74 years and inequalities widened slightly.
 Conclusions Slowing declines in premature mortality in Australia are accompanied by substantial and widening socioeconomic and geographic inequalities. Without reductions in mortality in lower socio-economic groups and outside capital cities, future life expectancy growth in Australia will likely be hampered.

Total natural resource rents, trade openness and economic growth in the top mineral-rich countries: New evidence from nonlinear and asymmetric analysis.

This paper investigates the impact of total natural resource rent on economic growth by applying the Nonlinear Autoregressive Distributed Lag (NARDL) developed by Shin et al. (2014) and nonlinear Granger causality proposed by Diks and Panchenko (2006) in the case of top ten mineral-rich countries in the world for the period 1981-2017. Empirically, after testing the stationarity properties of the variables, we applied the Johansen Cointegration approach to examine the cointegration relationship between total natural resource rent, trade openness, and economic growth. The causal relationship between the variables investigated by applying the conventional Granger Causality Test and the nonlinear Granger causality test. We employ the BDS Tests to examine the possibility of nonlinear dependence between the variables. Further, we tested the robustness of the asymmetric short- and long-run nonlinearities through positive and negative partial sum decompositions of the predetermined explanatory variables using NARDL, which exhibits robustness to small sample sizes. The empirical results confirm nonlinear cointegration between the variables in Australia, Brazil, Canada, The Democratic Republic of Congo (DRC), India, and Saudi Arabia. Long-run asymmetric effect results show that total natural resource rent has an adverse effect on economic growth in Australia, DRC, and India, therefore, confirming the "resource curse" phenomenon in these countries. However, we found that natural resource rent has a positive effect on economic growth in Brazil and Canada, which implies that natural resources contribute positively to economic growth and therefore is a blessing in these countries. Our Wald test results reveal a long-run asymmetric effect between total natural resource rent and economic growth in Australia, Canada, the DRC, India, and Saudi Arabia and a short run asymmetric effect in India and Saudi Arabia. The results also indicate a positive shock to trade openness has a positive impact on economic growth in most of the countries. The causality analysis in the nonlinear framework suggests that natural resource rent does not cause economic growth in the majority of the countries assessed. We recommend the implementation of more trade liberalization policies to maximize the benefits from trade openness, especially in the countries where the "natural resource curse phenomenon reported. Important policy implications can be learned from the empirical results.

The Current State of COVID-19 in Australia: Importation and Spread

Background: The rapid global spread of coronavirus disease (COVID-19) is unprecedented. The outbreak has quickly spread to more than 100 countries reporting over 100,000 confirmed cases. Australia reported its first case of COVID-19 on 25th January 2020 and has since implemented travel restrictions to stop further introduction of the virus. Methods: We analysed daily global COVID-19 data published by the World Health Organisation to investigate the spread of the virus thus far. To assess the current risk of COVID-19 importation and local spread in Australia we predict international passenger flows into Australia during 2020. Findings: Our analysis of global data shows that Australia can expect a similar growth rate of reported cases as observed in France and the United States. We identify travel patterns of Australian citizens/residents and foreign travellers that can inform the implementation of new and the alteration of existing travel restrictions related to COVID-19. Interpretation: Our findings identify the risk reduction potential of current travel bans, based on the proportion of returning travellers to Australia that are residents or visitors. The similarity of the exponential growth in the epidemic curve in Australia to other countries guides forecasts of COVID-19 growth in Australia, and opportunities for drawing lessons from other countries with more advanced outbreaks.

Travel attitudes and mode use among Asian international students at an Australian university

International students and immigrants in general are fuelling the growth in Australia’s population and the pressure that is putting on its urban transport systems. Yet, we know very little about their travel habits and limited previous research has been previously undertaken to address this gap. To address this research need, this study draws on a survey that was designed and distributed online and on-campus to students at Australia’s largest university (Monash University). Using multivariate statistical tools including factor analysis and multinomial logistic regression, significant differences were found between native-born Australian and Asian international students with regards to their mode perceptions, present travel habits and socio-demographics. For Asian students, attitudes towards non-car mode decrease and car-dependency increases the longer they reside in Australia. The findings of this research further highlight the need to encourage newer immigrants to use more sustainable travel options and highlight the relevance for local government and policy planners to support further research in this area, given that these international students have the potential to be key agents for travel behaviour change.

Content analysis of websites selling alcohol online in Australia.

Online alcohol sales have experienced rapid growth in Australia in recent years, averaging 14% annual growth over the last 5 years. This study aims to provide information about the advertised sales and delivery practices of online alcohol retailers in Australia and the potential implications for alcohol-related harm. A cross-sectional website content analysis of the 65 most visited Australian alcohol delivery websites. Data extracted for content analysis from each of the included websites fell under six broad categories: product range; average prices; promotions and discounting; payment and delivery; age verification methods; and policy statements. Online alcohol retailers offer a variety of alcohol products cheaply, with around 20% selling a 750 mL bottle of wine for under AUD$5. Most (81.5%) offered discounts for purchasing greater quantities and (89.2%) offered visitors an opportunity to sign up to receive discounts and promotions directly via email. Concerningly, 13.8% of websites allowed customers to purchase alcohol using a 'buy now, pay later' scheme such as AfterPay or Zip Pay. Delivery in under two hours was available from 12% of retailers. Most retailers (75.4%) advertised a willingness to leave alcohol unattended at an address. Online alcohol retailers offer a variety of alcohol products cheaply, accompanied by heavy promotions and discounting. Most retailers advertise a willingness to leave alcohol unattended at an address without having verified the purchasers age, which raises concerns about access to minors. Improved regulation of this growing industry in Australia is required. [Colbert S, Thornton L, Richmond R. Content analysis of websites selling alcohol online in Australia. Drug Alcohol Rev 2020].

Nexus between energy consumption, health expenditure and economic growth in Australia

Focussing on Australia, we examine the effects of energy consumption and health expenditure on output within the extended neo-classical Solow growth model. We use the ARDL bounds and non-Granger causality procedures for a sample period 1971-2014, to analyse the short-run and long-run effects of energy consumption and health expenditure on economic growth. Additionally, we examine the threshold values of energy and health expenditure. It is noted that in the long-run, energy consumption vis-à-vis output has a U-shaped relationship and the health expenditure has an inverted U-shaped relationship. The minimum energy consumption per capita necessary for growth needs to be at least 4,849 kilograms of oil equivalent, whereas the maximum amount of health expenditure, in real terms, should not exceed AU$ 5,959 per person. In terms of causality, we note a unidirectional causality from income, capital stock (investment) and health expenditure to energy consumption; and bidirectional causality between health expenditure and income. [Received: March 23, 2018; Accepted: November 18, 2018]

Shaping the decommissioning landscape of tomorrow

Associated with the growth of Australia’s oil and gas industry over the past 40 years, our oceans currently host oil and gas production and transportation infrastructure that will cost ~AU$30 billion to decommission. National Energy Resources Australia (NERA) is one of six industry growth centres (IGC) funded by the Australian Government. NERA is investigating opportunities for transforming the way that Australia manages its upcoming decommissioning activities. In 2019, NERA undertook a series of stakeholder consultations to refresh our understanding of Australia’s decommissioning outlook. Feedback was received through more than 20 interviews and follow-up surveys with the service sector, operators, research organisations, regulators and consultants. This paper highlights the outcomes of this review and NERA’s view on opportunities to position Australia favourably to manage decommissioning in a way that maximises benefits.

Nexus between energy consumption, health expenditure and economic growth in Australia

Focussing on Australia, we examine the effects of energy consumption and health expenditure on output within the extended neo-classical Solow growth model. We use the ARDL bounds and non-Granger causality procedures for a sample period 1971-2014, to analyse the short-run and long-run effects of energy consumption and health expenditure on economic growth. Additionally, we examine the threshold values of energy and health expenditure. It is noted that in the long-run, energy consumption vis-a-vis output has a U-shaped relationship and the health expenditure has an inverted U-shaped relationship. The minimum energy consumption per capita necessary for growth needs to be at least 4,849 kilograms of oil equivalent, whereas the maximum amount of health expenditure, in real terms, should not exceed AU$ 5,959 per person. In terms of causality, we note a unidirectional causality from income, capital stock (investment) and health expenditure to energy consumption; and bidirectional causality between health expenditure and income. [Received: March 23, 2018; Accepted: November 18, 2018]

Using Content Analysis to Characterise the Sensory Typicity and Quality Judgements of Australian Cabernet Sauvignon Wines.

Understanding the sensory attributes that explain the typicity of Australian Cabernet Sauvignon wines is essential for increasing value and growth of Australia’s reputation as a fine wine producer. Content analysis of 2598 web-based wine reviews from well-known wine writers, including tasting notes and scores, was used to gather information about the regional profiles of Australian Cabernet Sauvignon wines and to create selection criteria for further wine studies. In addition, a wine expert panel evaluated 84 commercial Cabernet Sauvignon wines from Coonawarra, Margaret River, Yarra Valley and Bordeaux, using freely chosen descriptions and overall quality scores. Using content analysis software, a sensory lexicon of descriptor categories was built and frequencies of each category for each region were computed. Distinction between the sensory profiles of the regions was achieved by correspondence analysis (CA) using online review and expert panellist data. Wine quality scores obtained from reviews and experts were converted into Australian wine show medal categories. CA of assigned medal and descriptor frequencies revealed the sensory attributes that appeared to drive medal-winning wines. Multiple factor analysis of frequencies from the reviews and expert panellists indicated agreement about descriptors that were associated with wines of low and high quality, with greater alignment at the lower end of the wine quality assessment scale.

The reverse mortgage conundrum: Perspectives of older households in Australia

Ageing populations in the Western World over the last few decades have necessitated the development of financial products to assist older people face the challenges of ageing. One such product is the reverse mortgage where homeowners unlock the equity in their residential property through a mortgage loan, secured over the property. These loans normally have no mortgage payments and are aimed at an older demographic. Such mortgages have been increasing in popularity in the United States and the United Kingdom, but growth in Australia's reverse mortgage market has been slow and the majority of financial institutions that once offered such mortgages have left the market. The purpose of this article is to explore reasons for this observation. To achieve this purpose, 31 people aged 65 and older were interviewed about their views on reverse mortgage and analysed using nVivo. Analysis showed that reverse mortgages are unpopular due to strongly negative views about the product itself and perceived the risks associated with them due to the debt and potential loss of assets as well as high interest and charges. While some participants would not enter a reverse mortgage due to a desire to pass on an estate to children, others were ambivalent about this. While this negativity may be overcome through a redesign aimed toward reducing these perceived risks, inherent characteristics as a debt instrument suggest that reverse mortgages are unlikely to be attractive, to the current generation of people aged over 65.

Modelling population retention in Australia’s Northern Territory – how do current forms of migration contribute to population turnover and retention?

ABSTRACTIn the past, population growth in Australia's Northern Territory, as in other peripheral parts of high-income countries, has been driven by internal labour migration and migration from outside of Australia. These have been contributing to the high population turnover experienced in peripheral areas. Since 2010, the Northern Territory has experienced low (and even negative) population growth, and public policy is currently focused on migration as a lever to reverse this trend. However, the extent to which the characteristics of migrants influence the potential for longer-term population growth is poorly understood. This paper uses a new method to analyse the contributions of various types of migrants to both population turnover and retention. Two major sets of findings emerge: First, the significance of separating newer in-migrants from longer-term residents when analysing migration patterns; and secondly, the contribution of age, gender, Indigenous status, international origin, wages and industry of employment to the Northern Territory's population turnover. The research suggests that current forms of migration favour people who are likely to stay for only short periods, and have high wage demands. The main policy inference is that long-term population growth will likely not eventuate unless new forms of migration can be stimulated.

Low Wage Growth: Why It Matters and How to Fix It

AbstractNeoclassical economic theory and its supply‐side account of the drivers of economic growth has been influential amongst Australian economic policymakers and advisors. In the post‐Keynesian tradition, we argue instead that aggregate demand drives economic growth, even in the medium term. In particular, the investment and innovation that depends upon that investment are mainly determined by the investment response to consumer demand. Currently, weak wages growth in Australia is weakening that consumer demand. The paper examines the causes of weak wages growth and offers solutions.

Simulated herbivory counteracts the effects of grass competition on the invasive fireweed (Senecio madagascariensis)

AbstractCompetition, herbivory and their interaction play a significant role in determining the competitive ability and survival of individual plant species. Understanding these processes and interactions can improve the efficacy of biocontrol programs against invasive weeds. Senecio madagascariensis (fireweed) is an invasive weed of South African origin that reduces pastoral productivity and poisons livestock in several countries, notably Australia. Although competitive pastures can suppress the weed’s growth in Australia, its competitive nature is poorly understood in relation to its invasion success. This greenhouse study assessed the growth and reproductive yield of fireweed growing in competition with six native and introduced grasses present in both South Africa and Australia. Since fireweed is a target for biocontrol in Australia, we examined whether its response to grass competition changed with herbivory (simulated by 40% leaf removal). The effect of grass competition and herbivory on the weed’s biomass and floral productivity was examined during a 12‐week pot trial in South Africa. Floral numbers were unaffected by both grass competition and herbivory. Biomass was used to calculate Relative Interaction Indices (RII) to quantify the weed’s competitive or facilitative response. This index compares a specific measurable trait, such as biomass, of fireweed growing alone, to fireweed growing with grass to determine the level of competitive suppression or facilitation resulting from the interaction. Despite the lack of species‐specific effects of grass competition, the presence of grass suppressed fireweed’s foliar, root and whole plant biomass the most when herbivory was absent. With herbivory, fireweed did not suffer from any measurable competitive suppression. This lack of competitive suppression may be due to an induced allelopathic response, given the levels of pyrrolizidine alkaloids common in many Senecio species. Since this result may weaken the case for biocontrol, the weed’s competitive responses should be verified in relation to actual insect herbivory.

Projecting spatial population and labour force growth in Australian districts

Projecting population in a local community is especially important to deliver public good provisions such as health services, education and social security. In addition to the size of the population and its age distribution, sex and location are also of importance for understanding needs and developing future infrastructure plans and growth policies. The projection of labour force growth is particularly important as labour is one of the primary inputs of economic production. This study aims to project the distribution of the future Australian population and its detailed characteristics. We analyse the projection of labour force growth in Australia and the proportion of people born outside the country, both at the district level, as examples of the model’s capability and applications. The microsimulation model used is designed to capture a detailed picture of the demographic evolution of the Australian population given current population trends, while also enabling us to understand the spatial distribution of migrants among the future Australian population. We validate our projections by making comparisons with recently released census data from 2016. The validation procedures we use show that our model has managed to not only project the population for sub-state/territory regions but also its age distribution as well as whether a person was born outside Australia. However, although our projection of the total size of the labour force produces reasonably accurate results, we found that estimates of the growth of the labour force were not as reliable, as the model was unable to capture the current negative growth of the labour force that is reflected in recent census data.

An archive of humanity: the NSW Division of the Australian Red Cross, 1914–2014

ABSTRACTTo commemorate its centenary, the NSW Division of the Australian Red Cross decided to donate its archive to the State Library of New South Wales in 2014. The State Library is honoured to be the recipient of these significant and extensive archives. In this article, the authors outline the process the librarians and archivists used to manage the donation and the importance of communication, both internally within the Library, and externally with the volunteers at the Red Cross who had arranged, compiled and cared for the archive. They describe the extent and organisation of the collection, the variety of formats and subjects, its historical significance and how it has been promoted to the State Library’s audiences. The authors reflect on how the archive charts the evolution and growth of Australia’s longest-running humanitarian organisation and how it contains the records of people who made history, but did not write the history books.