Australia's economic stability of the final report--report代写精选

51Due论文代写平台report代写范文:“Australia's economic stability of the final report”，这篇论文主要描述的是澳元作为澳大利亚国家指定的国家货币，虽然在近些年来的经济的形势变化复杂，但是澳元汇率的波动还是处于比较稳定范围内，澳大利亚的经济主要为以自由市场为主，少数伴随着政府对于市场经济的干预。

Australia is an independent western democracy with a population of more than 20 million. It is one of the world’s most urbanized countries. Australia’s economy has been doing increasingly well throughout the years and it has also proven to be very strong even during the recent economic depression. Australia’s economy is best classified as a mixed market economy because it has market economy with some government intervention. Government involvement include; owning major state enterprises, energy generation, providing health services, transportation systems, and owning communication enterprises. Most of the government’s involvement is positive and is helping the people and economy of Australia in addition to the private businesses prevailing in Australia. Free market, however, is arguably the main characteristic of Australia’s Economy and it consists of four major components; manufacturing, trade, finance, and services.

Australia’s economic growth commenced in the middle of the nineteenth century due to its woolen industry and the gold rush. This was the first economic boom in Australia and the second boom followed in the beginning of World War II until about 1970. By 2000, the economy started to stabilize and this was possible because of stability of the government over the years. Australia’s present economy consists of a lot of knowledge based industries such as Information Communication and Technology. Also, international trade has been substantial to the development of its economy.

Political System

Australia is a federal parliamentary democracy and a constitutional monarchy. This means that it uses a parliamentary system of government with Queen Elizabeth II as the monarch of the commonwealth realm. Australia’s current Prime Minister is Julia Gillard from the Australian Labour Party preceded by Kevin Rudd from the same party. However, the Liberal party was in power for in 11 years between before the Labor party came back into power and John Howard was the Prime Minister until 2007.

Australia gained independence from Britain and became a Common Wealth country in 1901. Since then, Australia has come a long way through passing various acts such as the Australia Act with Britain. The Australian Act was passed in 1986 and the British Parliament no longer had any say on the decisions that the Australian Government wanted to pass. The government was able to base its decisions on what its people wanted and what was best for the economy and society.

A country’s economy and its politics are incredibly dependent on each other. Primarily because Australia is a mixed market economy and that there is Government Involvement in the Economy. Conversely, the economy also reflects on the government because it gives the people ideas about who to vote for and whether or not they want to trust the political systems and the present government.

Economic Activity: Current and Trends

Gross Domestic Product- GDP

GDP has become a very popular measure of a country’s economic performance and standard of living. Australia is doing very well, the 2009 GDP Estimate: 851.1 Billion Dollars and is ranked 18th in the world. The total GDP has been increasing steadily. Australia being a developed country maintains a high GDP per capita as well. Some developing countries have large GDPs as well but the GDP per capita is very low; an excellent example would be India.

Figure 4 on the left shows the GDP from 1965 and overall there has been a considerable icnrease. The huge spike in GDP started in about 2000, when Australia’s economy was being dominated by tertiary industries.

Unemployment

As seen in the graph below, the unemployment rate has been quite uniform for the past 8 years. The most recent unemployment rate recorded was 5.2% on December 9th, 2010; this was a 0.2% decrease from November. This is quite an appreciable decrease in one month, and is approximately 19,500 people employed in one month.

Australia was actually the first country where full employment was made necessary even though it was a free society. This was all the way back in 1945 and the Australian governemnt has taken various measures to make sure that unemployment is at minimal numbers. The full employment rate was set in 1945 to be 4% and this rate was maintained 1941-1975. The graph above shows a more recent trend graph which is from 2005 and the graph on the below shows unemployment figures from 1980. Australia has done an adequate job to keep the unemployment rate low and it has been going down consistently from 1993. However, in 2009 there was a spike in the unemployment rate. In the graph above, this can be seen more closely, Australia tried to prevent the economic downturn from affecting its economy and people but 2009 wasn’t the best year for them. Fortunately, the unemployement rate is decreasing at a good rate and Australia is still trying to re Australia Act with Britain. The Australian Act was passed in 1986 and the British Parliament no longer had any say on the decisions that the Australian Government wanted to pass. The government was able to base its decisions on what its people wanted and what was best for the economy and society.

A country’s economy and its politics are incredibly dependent on each other. Primarily because Australia is a mixed market economy and that there is Government Involvement in the Economy. Conversely, the economy also reflects on the government because it gives the people ideas about who to vote for and whether or not they want to trust the political systems and the present government.

Economic Activity: Current and Trends

Gross Domestic Product- GDP

GDP has become a very popular measure of a country’s economic performance and standard of living. Australia is doing very well, the 2009 GDP Estimate: 851.1 Billion Dollars and is ranked 18th in the world. The total GDP has been increasing steadily. Australia being a developed country maintains a high GDP per capita as well. Some developing countries have large GDPs as well but the GDP per capita is very low; an excellent example would be India.

Figure 4 on the left shows the GDP from 1965 and overall there has been a considerable icnrease. The huge spike in GDP started in about 2000, when Australia’s economy was being dominated by tertiary industries.

Unemployment

As seen in the graph below, the unemployment rate has been quite uniform for the past 8 years. The most recent unemployment rate recorded was 5.2% on December 9th, 2010; this was a 0.2% decrease from November. This is quite an appreciable decrease in one month, and is approximately 19,500 people employed in one month.

Australia was actually the first country where full employment was made necessary even though it was a free society. This was all the way back in 1945 and the Australian governemnt has taken various measures to make sure that unemployment is at minimal numbers. The full employment rate was set in 1945 to be 4% and this rate was maintained 1941-1975. The graph above shows a more recent trend graph which is from 2005 and the graph on the below shows unemployment figures from 1980. Australia has done an adequate job to keep the unemployment rate low and it has been going down consistently from 1993. However, in 2009 there was a spike in the unemployment rate. In the graph above, this can be seen more closely, Australia tried to prevent the economic downturn from affecting its economy and people but 2009 wasn’t the best year for them. Fortunately, the unemployement rate is decreasing at a good rate and Australia is still trying to reach full unemployment.

Inflation has become a huge problem in Australia and may be the cause of the downfall of Australia’s Economy even after its incredulous revival from the economic depression a few years ago. In 2009, Inflation hit 4.40% and it was a rough patch for Australia due to the fact that it was trying to combat the economic depression. On the other hand, it was one of the few countries that was able to stabilize its economy even with the depression. With economic growth come s inflation as well and in the beginning of economic growth in 1980s to 1990s, the inflation was out of control. However, as shown in the graph, inflation has been quite fluctuant until about the 1990s; this is when Australia started taking more measures to control this inflation rate for the well-being of its public. This was done through excellent monetary and fiscal policy.

Productivity

Productivity is actually a growing problem in Australia. The latest graph that was provided was the year ended 2008 and it shows the productivity through the index which measures utilization of available labour and capital, economies of scale, and resource reallocation. In the long-term, it represents improvements in ways of doing things (technical progress), In the most recent productivity growth cycle (2003-04 to 2007-08) there was an overall decline in Australia's productivity. Output growth during this cycle averaged 3.6% per year, while total inputs grew at an average 3.8% per year

Standard of Living

Human Development Index:

The Standard of Living according to the Human Development Index (HDI) is incredibly high. Australia ranks second all over the world with an index of 0.937. The HDI of three different indicators: life expectancy at birth, education as measured by a combination of school enrollment and adult literacy, and standard of living as measured by a variation on GDP per capita that adjusts for price differences between countries.

GDP per capita

The Human Development Index does take into account GDP per capita, however, Australia’s GDP per capita of $42,279 is commendable and it shows that the people of Australia have a certain standard of livelihood. GDP per capita has been increasing steadily and this tells us about the economic growth as well. The Genuine Progress Indicator (GPI) was also used to calculate the GDP per capita and is a measure of economic growth. GPI is an attempt to measure whether a country's growth, increased production of goods, and expanding services have actually resulted in the improvement of the welfare of the people in the country. The GDP was not recalculated but GPI was considered into the final GDP figure.

Value of Currency in terms of US Dollars

The Australian Dollar is currently stronger than the US Dollar and 1 AUD= 1.0235 USD. Australia has been trying to maintain the strength of its dollar; however, Australia decided that controlling inflation was more important. A strong currency is good for importing; basically with a stronger currency Australia is able to purchase more foreign goods but at the same time its own goods become more expensive in foreign markets. The graph on the left shows the trade weighted index which is the value of Australia’s currency relative to the currencies of its major trading partners.

Contributions of different parts of the country to the national economy

The contribution of manufacturing to Australia's gross domestic product peaked in the 1960s at 25%, and had dropped to 13% by 2001-2002 and 10.5% by 2005–2006. In 2004–05, the manufacturing industry exported products worth $67,400 million, and employed 1.1 million people.

Australia is quite a big country and the manufacturing and contributions vary from different states of Australia. The chart below shows the fraction of manufacturing and gross state product:

The major manufacturing industries in Australia are; food processing, textile, motor vehicles, and chemical. Thanks to manufacturing from different states, Australia is able to produce finished products like cars, cleaning products, clothing, and hardware. Finished products were never Australia’s speciality. They were always the middle men between countries and provided natural resources and raw materials.

Also, as mentioned before, the service industry plays a huge part in Australia’s GDP. Major cities like Sydney, Melbourne and Canberra contribute a lot for this sector through tourism, banking, financing and etc.

Economic Efficiency

Market Structure and Corporate Concentration

Australia’s economy consists of mostly privately owned corporations. Australia is a free market however there is government control over major industries such as telecommunications. The Australian government doesn’t give privately owned companies to monopolize because of the negative effects it may have on the economy the buyer won’t have any say in the prices. Food and beverage companies are also monitored and partly owned by the government.Government regulation

Private Production:

Private production is monitored by the government and there are various government competition bureaus. Australian companies are regulated by a number of government agencies. The main one is the Trade Practices Commission, which has the responsibility of encouraging competition and preventing monopolization in any industry. The Trade Practices Commission is concerned with price discrimination, resale price maintenance, misuse of market power, types of exclusive dealing, and anticompetitive agreements. Another government body, the Prices Surveillance Authority, identifies prices that are deemed excessive and conducts inquiries to determine if high prices result from anti-competitive nature of a company.

The Industry Commission is also quite important; it is concerned with the allocation of resources in the economy as a whole. The Industry Commission advises the government on the setting of tariffs and other protective barriers needed to support Australian industry or to make it more competitive globally. Basically, it protects domestic production.

Public Goods and Services:

Just like Canada, Australia has Crown corporations and entities that are owned by the government. Services provided by government comprise an important part of Australia’s tertiary sector. Three of the largest areas, in terms of public spending, are health care, education, and welfare. The government controls telecommunications, electricity, broadcasting to some extent, and others. Australia’s government has always been quite involved with society and its citizens, and it wants to provide as many services as possible.

Economic Stability

Fiscal Policy

The government plays a big role in influencing a country’s economy. Fiscal policy is normally used alongside monetary policy. Basically, the government can make changes in where it wants to spend the money in order to satisfy the public and maintain good economic conditions.

Government Spending

As seen in the graph on the left, general government services and education are sectors that the government has increased spending in considerably. However, overall, the most money is spent for social security and welfare.

Taxes

Income Tax is where the government earns the highest revenue. This year, the Australian government has provided Australia with more benefits. There have been a few changes to income taxes:

Raising the effective tax-free threshold to $16,000

Providing a 50% tax reduction on up to $1,000 of interest income

Allowing a standard deduction for work-related expenses and the cost of managing simple tax affairs

Australia’s changes in the taxation policy are beneficial to citizens and it also helps stimulate the economy. Basically, there is an increase purchasing power and this means there is more money in circular the flow since it decreases leakage. For a long time, inflation has been a problem in Australia and taxes were increased in order to control this. This year is different though; Australia essentially decreased the tax rates this year.

Monetary Policy

Australia’s Central Bank

The Reserve Bank of Australia (RBA) is the central bank of Australia and is in charge of interest rates, inflation control and basically monetary policy.

Banking System

Until the 1980s, Australia’s banks were mostly publicly owned. Therefore, the banks had a lot of limitations. For example, banks in Australia were divided into two distinct categories, known as saving banks and trading banks. Saving banks paid virtually no interest to their depositors and their lending activities were restricted to providing mortgages. Trading banks were essentially merchant banks, which did not provide services to the general public.

Because of these and numerous other regulatory restrictions on banks, other forms of non-bank institutions flourished in Australia. These institutions had fewer restrictions and therefore became more popular. It took Australia until 1994 for privatized banks to be the majority,

Tools of Monetary Policy and Interest Rates

RBA implements monetary policies that focus on the stability of the Australian Dollar, the maintenance of full employment in the country and of course to ensure the economic prosperity of Australia’s citizens. Around the 1990s, Australia’s economy started growing incredibly. Agriculture was no longer the main industry and its economystarted becoming more secondary and tertiary. At this point, the Australian Dollar was becoming stronger and inflation started becoming a problem. Therefore, in 1993 a target was introduced and this target has been a base for most decisions on monetary policy. The graph on page 2 shows that RBA has been quite successful until 2007 and 2008. Basically, what the RBA does is that whenever inflation is higher than the target rate, it increases the interest rates charged which means that less people invest and borrow; therefore less money is circulated in the economy.

The main tool of monetary policy that Australia uses to control inflation is controlling the interest rates and these rates are determined by monitoring the cash rate. The cash rate is essentially the rate charged on overnight loans between financial mediators. This gives RBA an idea of the more specific economic conditions and can set their interest rates accordingly.

As stated before, 2009 wasn’t a good year for the economy and therefore the interest rates were comparitively lower in order to stimulate the economy by circulating more money. Australia’s overall interest rates are high compared to many other countries because of its need to control inflation.

Economic Equity

The graph on the left shows the Income Distribution of Australia’s people through a normal distribution chart. The mean income is about $800 a week. The incomes range from $50 a week to $2000. Diagram: S5. Distribution of equivalised disposable household income

Government Control of Economic Inequality

Progressive Taxes

The Australian Government does two main things to affect the distribution of income and make sure that there are no extreme inequalities within the society. These things are; the implementation of progressive taxes and welfare systems. Progressive tax is an indirect approach in affecting the distribution of income. Basically, people with different ranges of incomes are put in different tax brackets to maintain a degree of equality. As shown in the charts below, the tax for different income earners are quite different and this ensures a decrease in inconceivable differences of income.

Social Security

Social security is also focused on in Australia; it is a developed country and therefore can focus clearly on the wellbeing of individuals in the society. The Australian government does an amazing job of maintaining the standard of living. However, in the recent years there have been increasing complaints of welfare dependency. The types of social security that the Australian government provides are; Age pension, career allowance, assistance for isolated children, youth allowance, disability support pension, unemployment insurance, rent assistance, pharmaceutical allowance and many more. The amount of services that the government provides is quite impressive but of course this is done with tax payers’ money. There are many other social securities provided but these are the main ones that somewhat redistribute the wealth a little more equally.

Chart: Where taxpayers' money is spent

Economic Growth

Australia’s economy is growing but definitely at a slower rate than before. Australia has recovered from the first quarter of 2009 very quickly. However, its economy is not growing as fast as it was before. The graph below depicts the slow but steady growth in the economy and there is a lot to expect from Australia in the coming years.

International Trade and Competitiveness

Patterns of Trade

Over the years, Australia’s economy has changed greatly. Its economy is based largely on international trade and therefore it is assumed that the change in industries has affected the trading patterns. In 2000–2001, $3300 million was spent on assistance to the manufacturing industry, with 40% going to the textile, clothing and footwear industry and the passenger motor vehicle industry. At that time, manufacturing accounted for 48% of exports, and 45% of Australian research and development.

Various international trade agreements that are discussed later on have helped Australia make a name for itself. Basically, Australia is no longer relying on the United States or the United Kingdom to help sustain its economy. It has expanded trade to countries that are closer to it and is taking advantage of the booming economies in Asia.

File:2006Australian exports.PNG

Competitive and Comparative Advantages

Labour productivity and costs

The competitiveness of a country's goods and services can be influenced by movements in Australian labour costs, labour productivity and the Australian dollar relative to other currencies.

Real unit labour costs measure the pace of real wage rises compared with the pace of productivity improvement. Australia's real unit labour costs decreased between 1986 and 2009. This decrease was due to productivity gains outstripping increases in real hourly labour costs and is likelyto have had a positive effect on Australia's international competitiveness.

Other main advantages

Openness is another advantage that Australia has. Ideally an indicator of openness would measure both the size of, and barriers to, flows of trade and investment.

Australia’s natural resources are an advantage as well and are able to improve its mining industries greatly. Australia can base its exports on minerals and other natural resources and there will be a need for them at almost all times. Therefore,

Australia’s utilization of two-way trade helps it be a more competitive trading partner. Basically, this helps Australia gain advantages over other developed countries that may not import as many products from a country that it imports.

Trading Partners and International Agreements

World Trade Organization and Australia

Australia is

Free Trade Agreements (FTA)

Australia’s Government supports negotiation of free trade agreements and believes that it helps strengthen ties between countries and open up opportunities for Australian exporters. Australia already has Free Trade agreements with the following countries:

Newzealand: ASEAN FTA

Singapore-Australia FTA

Thailand: TAFTA

United States

Free trade agreements are under negotiation for China, Indonesia, Japan, Korea, and Malaysia.

Asia- Pacific Economic Cooperation (APEC)

APEC consists of 21 countries from the Asia-Pacific region; for example, Hong Kong, Indonesia, Canada, South Korea, and Japan. APEC was established in 1989 and its primary purpose is to facilitate economic growth and prosperity in the region. Through APEC trading, Australia has achieved investment liberalization, business facilitation and technical cooperation.

Australia has good relations with the world and imports and exports products to and from all over the world. However, Australia’s geographic location allows it to take advantage of trade from Asian countries. Its main export partners Japan 20.3%, China 11.5%, South Korea 7.9%, US 6.7%, New Zealand 6.5%, and India 5%. Australia’s main import partners US 13.9%, China 13.7%, Japan 11%, Singapore 5.6%, and Germany 5.6%

Major Goods Exported and Imported

Australia being a developed country has fewer primary and secondary industries. Agricultural products are not imported or exported but are rather kept within the country. Therefore, goods from secondary industries are needed. Major Australian imports include machinery and transport equipment, computers and office machines, telecommunication equipment and parts; crude oil and petroleum products.

Australia has a lot of natural resources to offer to the world also because of its geographic location. Major Australian Exports are coal, iron ore & concentrates, nickel, gold, meat products, wool, wheat, machinery, transport equipment, and natural gas.

Balance of Payment

Graph: Australia's trade balance to October 2010

When the balance of payments is positive, it means that the exports are higher than the imports, thus meaning that there is a demand for Australia’s currency. The opposite happens when the trade balance is negative; the imports are higher than the exports causing a decrease in demand for the Australian currency. It is important for any country keep the balance of payments somewhat consistent. In trade terms, the Australian Economy has had persistently large current account for more than 50 years. One single factor that undermines balance of payments is Australia's narrow export base .Dependent on commodities; the Australian government has strived to redevelop the Australian manufacturing sector. This initiative, also known as microeconomic reform, has helped Australian manufacturing to grow from 10.1% in 1983-1984 to 17.8% in 2003-2004.

Large balances often attract foreign investors into an economy, thus bringing in precious foreign exchange. When imports are greater than exports, a country has to use its foreign reserves to buy more products and therefore it affects the economic condition of the country. Australia has been fluctuant in the past three years as seen in the graph above. Political stability is also linked with balance of payments, if there is a surplus, citizens gain confidence in the federal government and gain confidence and confidence is the base of economic stimulation. Therefore, the balance of payments is quite important for a country’s economy.

Conclusion

Australia has done a commendable job of maintaining economic stability even during the current economic depression. It did this through monitoring fiscal and especially monetary policy closely as described before. The outlook is good for Australia but perhaps not as good as it was 4 or 5 years ago. There are still aspects such as unemployment, distribution of wealth and keeping its balance of payments in a surplus that have to be improved.

The citizens of Australia are living a good life. The standard of living is second best in the world according to HDI, the unemployment rates are comparatively good, economic growth seems to be coming back on track and income distribution follows a bell curve which is quite good for any country. The Australian government should be praised for Australia’s present economic conditions; it is doing very well in times of the slowdown. International Relations are also very good and Australia is trying to trade with new countries.

In conclusion, all the factors combine to give us assurance that Australia will continue to flourish in the coming years and that the government will be able to support its people and its economy. Hopefully, Australia will continue its excellence in monetary policies and improve on fiscal policy. The fiscal policies have been said to be too safe and that the government must take more risks in order to ensure a better economy and society.

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