Conflicts in Government Policy Objectives (HSC SSCE Economics): Flashcards
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Phillips curve relationship
Phillips curve relationship
Inverse link between unemployment & inflation (short-medium term)
Effect of higher aggregate demand on unemployment
Effect of higher aggregate demand on unemployment
Decreases unemployment (businesses hire more workers)
Asymmetric Phillips curve at high unemployment
Asymmetric Phillips curve at high unemployment
Curve flattens; wages & prices respond weakly to changes
Australia 2023: RBA unemployment target for inflation control
Australia 2023: RBA unemployment target for inflation control
Increase from 3.6% to 4.5% to reach 2-3% target (Bullock)
Three major policy conflicts
Three major policy conflicts
Unemployment vs inflation; growth vs environment; growth vs CAD
Short-term conflict: economic growth vs environment
Short-term conflict: economic growth vs environment
Growth increases pollution, waste, emissions & resource use
Balance of payments constraint
Balance of payments constraint
Limitation on growth from impact on current account deficit
Growth-external balance mechanism
Growth-external balance mechanism
Growth → consumption/investment → imports → current account deficit
Australia's Measuring What Matters framework (July 2023)
Australia's Measuring What Matters framework (July 2023)
50 indicators for broader assessment of national prosperity
Inclusive growth principle
Inclusive growth principle
Sharing economic gains equitably can support stronger growth