Australia’s Luck

June 8, 2012 in Daily Bulletin

In a speech Andrew Leigh reviewed the history of Australia’s economic performance and what it meant for the future of the country. In particular he argued that while Australia had pursued effective policies, it had also been extremely lucky, and this luck may not be replicated in the future. The six things that made Australia lucky include:

  • Plentiful land. Europe had little land and lots of people. Australia had lots of land and few people. This meant that wages for Australians were high and this created economic opportunities.
  • Gold. After gold was discovered in 1851, national income quadrupled in a decade.
  • Inventions. The first half of the twentieth century saw a remarkable amount of innovation. Why is this lucky? Because it might not be replicated again. You may think that innovation has continued into this century but consider, would you rather give up indoor plumbing and penicillin or your iPad?
  • Immigrants. As a proportion of its overall population Australia had a stunning amount of immigrants.
  • Rising commodity prices in the 21st century. The prices for minerals that Australia mines have tripled in the past decade as India and China continue to develop.

The speech is informative and entertaining. Leigh considers his own party’s mistakes as well as the mistakes that other parties are currently making. All the while he illustrates his points with fascinating examples. It’s by far the best speech that Centives has covered so head on over here to get the rest of it.

Source: Andrew Leigh

Via: Marginal Revolution