Saturday, 25 July 2009

Herald on the appointment of Brash

Thanks to the Inquiring Mind I was pointed towards this editorial from the Herald on the appointment of the Brash taskforce. There are a number of odd things in this editorial.
The taskforce is welcome. For more than 20 years, Australia has placed a strong emphasis on productivity. It was recognised in the compulsory superannuation arrangements and in the Australian Productivity Commission.

This was formed as an "independent research and advisory body on a range of economic, social and environmental issues affecting the welfare of Australians". It has been highly successful and enjoys cross-party support.
Exactly, how is this success being measured? What makes the Australian Productivity Commission such a success? How does the editorial writer know it has been successful? Has he actually checked up on this? What evidence do they have that this is true? Could it not be possible that Australia's productivity growth would have been even higher without the commission?
The size of its job is indicated by the fact that, while productivity in New Zealand and Australia was on a par 40 years ago, Australia's is now about a third higher, as are incomes there.
Let us take this as true, the question that should be asked is: What evidence this there that this divergence in productivity has anything to do with the Australian Productivity Commission? If it doesn't, Why does New Zealand need the Brash Taskforce?
In New Zealand's case, these are all the more important because productivity is not helped by a small population and remoteness from large markets.
What do either of these have to do with productivity? Why can't a country with a small population be just as productive as a large one. Is India really all that much more productive than, say, Singapore? How does distance from markets affect productivity?
Australia's Productivity Commission has ventured far and wide in seeking to provide the best canvas for prosperity. One of its recent inquiries found book prices were far too high because foreign versions of any book published in Australia cannot be sold there.
Two things seems odd here. Australians needed the Productivity Commission to tell them that foreign versions of any book published in Australia cannot be sold there? Does it matter? Haven't Australian heard of Secondly, and more importantly, what precisely has the price of books published in Australia actually got to do with productivity in Australia?

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