The terms of trade are subject to both permanent and transitory shocks. Particularly for commodity-producing small open economies, it is sometimes argued that the inability of agents to determine which of these shocks are permanent and which are transitory leads to more macroeconomic volatility...

This paper quantifies the links from demand for Australia's natural resources to activity in other domestic industries by using structural relationships embedded in input-output tables. Extending the methodology of Kouparitsas (2011), we estimate the size, growth rate, and industry value-added...

This paper estimates the effects of the mining boom in Australia, using a large-scale structural macroeconometric model, AUS-M. We estimate that the mining boom boosted real per capita household disposable income by 13 per cent by 2013. The boom has contributed to a large appreciation of the...

The Australian mining industry experienced a remarkable turnaround during the 2000s. The rapid growth of emerging economies in Asia drove a surge in demand for commodities, particularly those used in steel and energy generation. With global supply unable to respond quickly, prices surged to...

Is China’s demand for resources driven predominantly by domestic factors or by global demand for its exports? The answer to this question is important for many resource-exporting countries, such as Australia, Brazil, Canada and India. This paper provides evidence that China’s...

The terms of trade of commodity-producing small open economies are subject to large shocks that can be an important source of economic fluctuations. Alongside times of high volatility, however, these economies also experience periods in which their terms of trade are comparatively stable. We...

Strong growth in Asia, particularly in China, has had a profound impact on the Australian economy over the past decade. Most notable so far has been the boom in the resource sector, with commodity prices and hence Australia's terms of trade rising to historically high levels over a number of...

This paper studies the effect of a shock to resource prices in a small open economy where the stock of natural resources is responsive to exploration activity, and where extraction reduces the future availability of reserves. We show that the effects of a resource price shock on resource...

House prices are intrinsically difficult to measure due to changes in the composition of properties sold through time and changes in the quality of housing. I provide an overview of the theoretical nature of these issues and consider how regression-based measures of house prices – hedonic and...

Developments in housing prices are of interest to households, policy-makers and those involved in the housing industry. This has been the case both in Australia and in other countries where house price developments are having significant macroeconomic impacts. However, the construction of...