This paper considers whether capital is a significant constraint on employment in Australia. We calculate the level of capital-constrained employment for ten sectors of the Australian economy. The calculations suggest that the manufacturing; mining; transport, storage and communication and...

In this paper we use daily data to examine the relationships between the unofficial cash rate, the $A/$US exchange rate and other interest rates. In particular, we investigate whether any change in these relationships occurred after October 1987. Amongst other results, we find that in the period...

This paper poses two questions: why did the equilibrium rate of unemployment rise so much in the 1970s, and why does unemployment increase rapidly during recessions, but decrease so slowly in the subequent recovery, i.e. why is unemployment persistent? We find that equilibrium unemployment rose...

In this paper, I investigate the link between real wage rigidities, nominal wage and price rigidities, and nominal exchange rate volatility. Using a model of overlapping wage contracts and monopolistic price-setting, where prices are costly to change, I find sticky nominal prices and wages to be...

This paper examines the determination of inflation in Australia and its four major trading partners – Japan, the United States, the United Kingdom and New Zealand. Also examined is the degree of inertia in the inflation rate i.e. the extent to which observed inflation deviates from its...

One of the most important features of the Australian economy in the past two decades has been the structural deterioration of labour market performance, reflected in both an increase in the average rate of unemployment and an outward shift in the Beveridge Curve, which depicts the relationship...

Major changes to the Australian financial system occurred in the 1980s that were potentially important for the effects of monetary policy on economic activity. Using vector autoregressive econometric techniques we find that, in fact, the deregulation of the financial system has made very little...