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Climate Change is the Biggest Driver of Disruptive Innovation

 

So Australia wants to become innovative. The Lucky Country wants to become the Smart Country. It wants to embrace disruptive innovation, face the future boldly and feed the teeming masses of Asia with our clean and green food. Yet, when the choice was there for Australia’s leaders to either choose to grab the opportunity with both hands or to pretend ‘she’ll be right, mate’, they chose the latter. In fact, they chose the latter with such alacrity that at least three Prime Ministers have fallen over the issue. Yet, now our leaders are telling us that we have to become more ‘risk-taking’, ‘entrepreneurial’ and willing to tolerate failure. All good sentiments, but our leaders have been found wanting on the greatest economic challenge of our time: climate change.

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The Economic Case for Reducing Indigenous Disadvantage in Australia

In Australia, the Australian Football League celebrated the contribution of Indigenous Australians to the game. This year’s ‘Indigenous round’ will be remembered for Adam Goodes’ war dance after kicking a goal. It was also reconciliation week, that is the week where Indigenous people were counted in the census and the historic Mabo decision that recognised Native Title. Yet, despite the mainstream acceptance that the past treatment of Indigenous Australians was shameful, there was little discussion that Indigenous Australians are still living with the effects of European colonisation. Indigenous Australians have a 10 years shorter life expectancy than non-Indigenous Australians; they make up 26% of the prison population in 2008 whilst making up 2.5% of total Australian population in 2006; 17% were unemployed in 2011 compared to 3.6% of non-Indigenous population; and Indigenous people account for 9% of homelessness. These social, health and economic indicators have budgetary consequences for both Federal and State governments. While there exists a strong moral case to reduce Indigenous disadvantage, there is also a very strong economic case for Australian governments: reducing Indigenous disadvantage could save both Federal and State governments $450,000per person over their lifetime.

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Is Australia’s Health System Financially-Sustainable?

Introduction

One of the great social policy achievements of Australian governments was to establish a health system that is able to deliver world best health outcomes at relatively modest cost to almost all Australians. According to the Organisation of Economic Cooperation and Development (OECD), Australian life expectancy is the 6th highest in the OECD at 82 years at birth in 2014. This cost Australians the relatively modest amount of 9.1% of GDP (21st highest in the OECD), which compares favourably to the OECD average of 9.3% in 2012. As impressive as this success is, is it financially sustainable? Can Australia continue to achieve these impressive health outcomes for a relatively modest amount? Or will Australia’s demographics and emerging health challenges force Australians to spend more of their tax and income on the health system?

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Procrastination and Carbon Pricing: the Real Option of a Carbon Price on the Economy

 

Introduction

A couple of weeks ago, after I posted “Was it Worth It? The Benefit-Cost of Air Pollution in China“, I was asked by Ecoscore to think about the benefit-cost of Australia procrastinating on a carbon price.

 

So, using my understanding of Australia’s carbon policy and economics what do I think? Has it been good for Australia? What can the rest of the world learn from Australia?

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Does it Make Sense to Increase Labour Supply to Stimulate Economic Growth?

 

Introduction

The Australian Government recently released the 2015 Intergenerational Report in an effort to educate the Australian public on the challenges facing the government and society by 2055. According to Treasury’s modelling, net debt would increase from 15.2% of GDP to 60% by 2055. Per capita income growth would increase from 1.7% per year to 1.5%. What does the Australian Government propose to do about it? Their answer is to increase participation and productivity – i.e. increase the quantity and quality of inputs used in economic growth. The government seems to mean increasing labour supply and improving labour productivity. But does this policy prescription actually make sense?

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VIDEO: Sustainable Farming with Wayne Lording (Wrap Up)

In this post, we wrap up our interview with Wayne Lording. Previously, we looked at what Wayne did to reduce his energy bills and water and fertiliser use. See here for an introduction to the series. The key points from the wrap up are:

  • Wayne’s investment helped reduced his costs through lower use of LPG, electricity, fertiliser and water,
  • Other farmers can also reduce their costs by investing in renewables and water reuse,
  • Very easy to install,
  • Can benefit very soon from reduced utility bills, and
  • Can also benefit from freeing up cash to invest in the farm.

Thanks for watching, I hope you enjoyed the series!

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VIDEO: Water Reuse on Wayne Lording’s Farm

This week we consider our series on sustainable farming by talking to Wayne Lording about how he recycles grey- and black-water to replace irrigated water and fertiliser. Key points are:

  • Treated water is used to irrigate and fertilise olive groves.
  • The key technology is a small pump, which is readily available.
  • Water reuse system has a payback period of 18 months.
  • The more water and fertiliser you use, the more you can save from installing a similar water reuse system.
  • Wayne’s water reuse system also has risk-management benefits by providing a hedge against water and fertiliser price increases.

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VIDEO: Solar and Geothermal on Wayne Lording’s Farm

In the second of our series on Sustainable Farming on Wayne Lording’s farm (see here for the introduction), we talk to Wayne about how and why he installed solar and geothermal technologies to replace conventional energy sources. Key points are:

  • Combined solar and geothermal system has a payback period of one year.
  • Geothermal technologies are available and proven in Australia.
  • The key savings are from reducing ongoing energy costs. In Wayne’s case, he saved $5200 per year from reducing the need to use LPG.
  • Because renewable energy technologies require little or no fuel, they provide a useful hedge against electricity or LPG price volatility.

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VIDEO: Sustainable Farming with Wayne Lording (Introduction)

Late last year Lindsey Beck and I interviewed Wayne Lording on his farm. I was interested to see why and how Wayne implemented sustainability technologies on his farm. Essentially, he gains a financial benefit from using renewable energy and water reuse. Interestingly, he is one of the few farmers using geothermal energy on his farm. The two videos here are an introduction this series. In the following weeks we will have videos on:

  • Renewable energy, specifically solar and geothermal,
  • Water reuse, and
  • Wrap up,

In all the videos, I provide a brief economic analysis of Wayne’s investments. I hope you enjoy this series.

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The Economics of Racial Stereotypes

During World War II, Australian soldiers were told they had nothing to fear from Japanese soldiers. They were short, wore glasses and their rifles fired puny bullets that would bounce off a strapping young Aussie lad. No worries. Should fix them up before tea then you can go and fight some real soldiers like the Germans once you’ve done with the Japs.

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