Microeconomic reforms (1 Viewer)

[daodao]

Hey,

Can anyone help me with this please?

What are the major microeconomic reforms of the Federal government and what are the structural changes that result from the policies?

Cheers,
daodao

 

[ToO LaZy ^*]

labour reform
trade policy reform (competition policy)

 

[hanjoc]

stuff like deregulation, the new competition policy, decreased protection and liberalisation of trade all comes under MER's of making the market more efficient with the same resources...

 

[SoCal]

Yeah, so what tends to happen is that resources move to the most efficient industry's, improving the allocation of resources.

 

[nesstar]

In general u will find that microreform --> increased efficiency --> increased competitiveness

A couple of examples

Financial deregulation
Structural problem: uncompetitive financial sector, hence policies to increase competitiveness were implemented
* floating of $A and removal of RBA direct monetary control over banks
* non-bank financial institiutions allowed to provide banking services
* introduction of foreign banks

Trade policy
Structural problem: high domestic protection, uncompetitive market
* trade agreements
* reduced protection e.g. tariff reductions
These cause increased integration with the global economy, hence increased efficiency and competitiveness. More goods and services are produced at better quality and lower prices.
* industry assistance - lower costs --> more able to compete

Of course, there are many more microreforms: National Competition Policy, Labour market reform, corporatisation/privatisation and taxation reform to name a few.