Poor Nation of the Pacific? Australia’s Future Reassessed

Abstract

Australian economic performance was far worse in the 14 years following 1973 than in the previous 25 years. The rate of growth of output declined substantially. Part of this decline was due to slower population growth, but growth in output per head of population fell from an average of 2.2 per cent a year in the earlier period to 1.5 per cent a year from 1973 to 1987. Unemployment showed a strong upward trend over the period and although the level of about 8 per cent in 1987 was below the peak of 10 per cent reached in 1983, it is still about four times the average level of unemployment in the 1950s and 1960s. Inflation rose to the high level of 20 per cent in 1974, as it did in 1951; but unlike the case in the 1950s, it did not return to a low level but averaged 9 per cent a year from 1975 to 1987.