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Australia's Unemployment Problem
Author(s) -
LE ANH T.,
MILLER PAUL W.
Publication year - 2000
Publication title -
economic record
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.365
H-Index - 42
eISSN - 1475-4932
pISSN - 0013-0249
DOI - 10.1111/j.1475-4932.2000.tb00006.x
Subject(s) - unemployment , economics , full employment , wage , unemployment rate , aggregate demand , labour economics , wage rate , macroeconomics , monetary policy
A number of Australian studies have provided microeconomic and macroeconomic perspectives on the causes of, and solutions to, Australia's unemployment problem. This paper provides an evaluation of these studies. Several important findings can be noted. First, from the cross‐sectional studies economists have gained a good understanding of the factors contributing to a high probability of unemployment. Effective use is currently being made of this information. Second, there is general consensus from the time‐series studies regarding the estimates of the aggregate labour demand wage and output elasticities. In addition, it has been widely acknowledged that lower real wages and economic growth would help reduce the high rate of unemployment. Despite the information available we are making slow progress towards reducing the unemployment rate. This may be due to political reasons or because we are unsure of how to deliver the wage cuts and faster rates of economic growth presented as solutions to the unemployment problem.