Why Australia Needs Research

By Fountain, Chris | IPA Review, January 1, 1995 | Go to article overview

Why Australia Needs Research


Fountain, Chris, IPA Review


IN an issue of New Scientist (16 January 1993), former Commissioner for the Future and current head of the Science Policy Research Centre at Griffith University, Professor Ian Lowe, made the comment: "Research aimed at putting people out of work worries me."

It shouldn't.

In effect, what Lowe said was: "Research aimed at increasing productivity worries me." This was confirmed in Lowe's New Scientist column the following week. In commenting on the 90 per cent increase in productivity in the Australian electricity industry that was said to have occurred since the mid-1970s, Lowe said: "But why, at a time of high unemployment, are we striving to eliminate jobs in the power industry?"

These comments attack precisely the research that has given us the high standard of living that most of us in the developed world enjoy today. That there are currently so many unemployed is not a result of a lack of work; one needs only to consider the number of potholes in local roads, the parlous state of ageing sewerage systems, and the number of people on the waiting lists of various national health systems to realize that there is plenty of work to be done.

PRODUCTIVITY MATTERS: The very existence of sealed roads, sewerage systems, and national health systems is due to past innovations that have increased productivity. Such systems are the result of surpluses generated in highly productive economies. According to Geoffrey Blainey (in The Great Seesaw), a typical family living in 18th-century France in a good year probably spent half of its income buying bread alone. Such families, struggling to make ends meet, do not have money to spare for the taxes needed to seal roads, to develop extensive sewerage systems, or to provide 'free' medical care for all. Indeed, as Blainey commented, a small rise in the price of grain was catastrophic; there were sixteen general famines in France between 1701 and 1800.

Today, for most citizens of the Western developed world, the price of bread is a small fraction of the family income. According to Choice magazine (February 1993), an Australian living in a capital city and earning the average wage had to work about 5.75 minutes to earn enough (before tax) for a loaf of bread. This reduction in cost is largely the result of improvements in the productivity of farms and farm workers. In 1988, only 5.3 per cent of the Australian labour force was employed in agriculture; in the US the figure was even lower, at 2.5 per cent.

Imagine the cost of wheat if a much larger proportion of the population of the developed world was employed in agriculture, using more labour intensive practices. Each worker would, of course, want to be paid a fair wage for his or her efforts.

One does not need to stretch one's imagination very much. Agriculture in Nepal is labour intensive: 92 per cent of the Nepalese workforce is employed in agriculture. The value of the output of each of these agricultural workers in 1988 was $US222. The value of the production of each American farm worker that year was $US33,500. Nepal is one of the world's poorest countries; The Economist Book of Vital World Statistics ranked it 137th out of 146 in terms of 1988 GDP per head.

BOOSTING PRODUCTIVITY: The tremendous increase in productivity of the agricultural labour force in the developed world is the result of past research and development. The fall in the prices of agricultural products in the developed world is a consequence. Wheat prices in 1950 were equivalent to $A900 per tonne in 1991 dollars; the 1991 price was about $A165 per tonne.

I should say, at this point, that by research and development, I am not thinking solely of the work of scientists and engineers in research laboratories. I am also including the tinkering that might go on down on the farm or in a factory, to get that little bit of extra yield from the land or make that maintenance job a little bit quicker, cheaper and more effective.

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