Microeconomic Reform and Productivity Growth

Productivity growth plays a central role in improving living standards. Microeconomic reform is intended to stimulate productivity growth, but there are important unresolved questions. How effective have different Australians reforms actually been? What lessons can be learnt from overseas?

These questions are examined by leading analysts of the micro-reform process in the Productivity Commission/Australian National University Workshop Proceedings, released today.

The Proceedings cover concepts and measurement issues, analyse the recent growth performance of Australia and New Zealand, and include case studies of microeconomic reform in Australia.

The Workshop was held in February 1998. It examined important questions concerning the link between microeconomic reform and the process of growth, including:

• How well can productivity be measured?
• How does microeconomic reform improve productivity and growth?
• How important is microeconomic reform relative to the other drivers of productivity improvement?
• What microeconomic policies provide the greatest leverage for growth?
• How should we assess the costs of improving productivity, and how can adjustment issues best be handled?

While microeconomic reform is intended to improve living standards, it is clear that it remains under challenge in the community generally and even in some sections of the economics profession itself. The dialogue stimulated by the Workshop is part of a wider process to address these concerns and, ultimately, to enable governments to improve the management of ongoing reform.