Academic journal article Australasian Journal of Regional Studies

Australia's Changing Economic Geography Revisited

Academic journal article Australasian Journal of Regional Studies

Australia's Changing Economic Geography Revisited

Article excerpt


In 2002, Oxford University Press published a book written by Kevin O'Connor, Robert Stimson and Maurice Daly, Australia's Changing Economic Geography: A Society Dividing. It told the story of changes that had occurred in the economic geography of the nation in the context of globalization and the processes of economic restructuring and population change that had been occurring over the decade 1986 to 1996. It was noted how the nation's economic geography is "volatile" and how the "impacts of that volatility can be both profound and uneven as it differentially affects both people and places" (O'Connor et al., 2002, p. 1). In the preface to that book O'Connor et al. (2002, p. xvii) had this to say:

"... Geography plays a crucial role in the operation of economic and social processes, a dimension ignored in much current Australian public policy development and program implementation. The fundamental rearrangement of spatial patterns of activity presents major challenge for the people, businesses, and politicians of Australia's cities and region. What we have is a society dividing on many dimensions, with some people and some places as winners while others are losing."

This paper revisits Australia's changing economic geography. The objective is to see how the trends and patterns evident in the decade 1986 to 1996, as discussed in the O'Connor et al. book, have persisted or changed over the subsequent decade 1996 to 2006.

The O'Connor et al. (2001) analysis covered an important period that followed (and partly encompassed) a series of landmark macro-reforms initiated by the Hawke-Keating Labor Government. The Australian dollar was floated; the financial system was deregulated and opened to foreign banks; tariff barriers were dismantled to liberalise trade; foreign investment controls were relaxed; competition policy was introduced; and there was corporatisation and privatisation of public utilities and services. It was a landmark period of massive reform and deregulation.

The implications of those changes were profound, and the regional impacts were most varied as Australia was transformed from a long era of protectionism and tight regulation to an open economy era of deregulation and having to compete internationally. The era was one of a shift from what O'Connor et al. (2002, p. 13) described as the "old economy" to a "new economy" which was a "services-dominated economy utilising knowledge-based, information-intensive processes of production".

While Australia as a nation was to become more competitive, the benefits of that era of reform were spread unevenly. There were clear winners and losers both for people and for places. For some regions the pain of enforced economic restructuring was severe, while other regions boomed. The 'recession we had to have' (as former Federal Treasurer Paul Keating put it) in the early 1990s was to exacerbate those divides.

The subsequent decade, 1996 to 2006, saw an electoral change from 13 years of Federal Labor Government to 11 years of the Howard Coalition Government. This coincided with the 'long boom' and including significant labour market reforms and deregulation. But the spatial patterns of 'winners' and 'losers' was also to change.


Reviewing the decade 1986 to 1996, the O'Connor et al. (2002) book provided an analysis of changes in the spatial patterns of performance evident across Australia's cities and regions in terms of where people lived and worked, and where investment was being directed.

2.1 Fundamental Structural Shifts

What were some of the fundamental structural shifts that occurred in the Australian economy? They included the following:

* The share of employment in producer services increased from 16.33 per cent to 18.36 per cent between 1986 and 1998.

* Tourism increased from 3.36 to 4.71 per cent. …

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