What is it about?
Commonwealth governments in Australia have provided assistance to both the agricultural and the manufacturing sectors since federation in 1901. We constructed time series for each sector using the nominal rate of assistance as the measure of assistance and then we compared the two series and found that assistance to manufacturing was much higher than to agriculture.
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Why is it important?
The levels of assistance to the two sectors differ markedly over the time period studied: assistance to manufacturing was much higher than that to the agricultural sector from federation until the 1980s when assistance to both sectors fell and by 2010-11 rates were approximately equal at less than 5 per cent.
Perspectives
Constructing the time series of the nominal rates of assistance required the identification and understanding of the policy instruments which gave rise to this assistance as they varied across the century. Thus, it was an exercise in economic history which showed that the Australian agricultural sector was substantially discriminated against throughout the time period studied because of the much higher rates of assistance given to the manufacturing sector. It is only in the past quarter of a century that assistance to both sectors has all but disappeared to give an economy that is much more efficient than it had been in the previous three-quarters of a century.
Professor Donald MacLaren
University of Melbourne
Read the Original
This page is a summary of: Relative assistance to Australian agriculture and manufacturing since Federation, Australian Journal of Agricultural and Resource Economics, August 2014, Wiley,
DOI: 10.1111/1467-8489.12070.
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