Trade agreements and the myth of policy constraint in Australia

In this paper, I challenge the conventional view that trade agreements act as a major constraint on Australia’s industry policy options. Through a comparison with South Korea – a country with similar trade obligations to Australia – I find that the Australian government retains significant room to move in the industry policy sphere. However, Australian policy-makers appear far less willing than their foreign counterparts to use that space. To explain Australia’s comparative industry policy in-activism, I move beyond broad-brush explanations centred on ‘liberal ideology’ to explore the ideational, institutional and structural obstacles to the pursuit of a more proactive industry policy approach on the part of Australian policy-makers.     

The history of Australian legal opposition to Japanese Antarctic whaling

ABSTRACT

Whaling has been a consistent theme in Australia’s relations with Japan since the 1930s, Australia having endeavoured to regulate, restrict, or bring to a complete halt Japan’s Antarctic whaling virtually since it began. Australia’s motivations have been mixed, involving at various points, some combination of protection of Australia’s coastal whaling industry, concern for Australia’s security, for safeguarding Australia’s Antarctic territorial claim, and more recently, concern for Australia’s whale-watching industry and/or for the whales. Since environmental consciousness became a primary factor in the 1970s, Australian policy has been aligned with that of anti-whaling non-governmental organizations (NGOs), albeit that certain actions of NGOs have caused difficulties for the Australian Government. Law – inclusive of legal argument in the course of diplomacy, domestic laws, and international litigation – has been a mechanism of influence used by the Australian Government and NGOs. This paper traces Australia’s legal opposition from its beginnings until Japan’s announcement in December 2018 that it would end Antarctic whaling.     

Interest aggregators,not office chasers: evidence for party convergence and divergence in Australia

This paper examines whether Australia’s major political parties continue to fulfil a representational role. This was often the traditional view of the parties, but has been much criticised in recent decades by scholars arguing they have largely converged, moderating their policies and abandoning their links with civil society. Here I outline a theoretical framework – supported with evidence from four empirical tests – that characterises the major parties as interest aggregators representing electoral alliances made up of politicians, activists, financial contributors and voters, united by key economic policy goals. These actors create a centrifugal force, pushing party policies away from each other in salient areas. Using this framework, I theorise that the parties matter for policy outcomes, building on the assumption that cleavages in the social structure are reflected in the political system, with policy implementation the result of the competing demands and interests of the parties’ constituencies.     

Do we need more economics in Australian economic diplomacy?

ABSTRACT

Economic diplomacy—that is, informal and formal processes and links between states and non-state actors on international economic issues—is a current focus of Australian foreign policy. The Department of Foreign Affairs and Trade’s stated economy diplomacy aims are liberalising trade, boosting economic growth, encouraging investment and assisting business. If Australia is to embrace a genuine and effective notion of economic diplomacy there are two problems to be overcome. First, DFAT’s economic diplomacy framework is incomplete and misses the bigger economic picture, particularly the role of Australia’s key economic agencies, Treasury and the Reserve Bank of Australia. Second, DFAT does not consistently apply economic principles to foreign affairs issues including trade, foreign aid and the global investment agenda. Going forward, Australia should abandon the focus on the four narrow pillars and instead focus on developing a clear, coordinated international economic strategy that articulates Australia’s core international economic objectives and priorities.     

Rural Transformation and Cultural Industries: Popular Music on the New South Wales Far North Coast

This article explores the emergence of popular music as a niche cultural industry, connected to economic and social transformations on the New South Wales Far North Coast (also known as the ‘Northern Rivers’ region). The various images of the New South Wales Far North Coast as a ‘lifestyle’ region, ‘alternative’ locale and coastal retreat have attracted a diverse mix of ex–urban professionals, unemployed persons, youth subcultures, backpacker tourists and retirees. Yet, despite population growth, the region continues to suffer unemployment rates among the highest in Australia. Against this backdrop, diverse popular music ‘scenes’ have emerged, constituting an industry with linkages to cultural production in Sydney, Melbourne and overseas. While the region’s unique cultural mix has been suggested as a key site of comparative advantage, future employment is likely to remain transient, insecure, and governed by industry–wide labour relations. This case study illustrates some of the complexities underpinning contemporary urban–regional change in Australia, and provides cautious assessment of the capacity of the cultural industries to reinvigorate rural economies.     

A False Start? British Perspectives on Italy’s Participation in the Early Phases of the European Economic Integration Process: The Case of the OEEC (1948–1952)

Abstract

This article examines how Anglo-Italian relationships unfolded in the aftermath of the Second World War within the framework of the Organization for European Economic Cooperation (OEEC). By analysing Italy’s participation in the early stages of the European integration process through the lens of British diplomacy, this contribution aims to shed new light on the international dimension of Rome’s post-1945 political and economic strategies. First, the article considers the main concerns that characterized Italy’s involvement in the OEEC activities between the late 1940s and the early 1950s: the promotion of the circulation of the intra- and extra-European manpower and the liberalization of trade and payments. Second, rather than making a ‘classic’ comparison between the divergent policies – particularly the internal and international economic programmes – that Britain and Italy pursued within the OEEC, this article highlights the extent to which an ‘asymmetry of power’ impacted Italy’s ability to realize its strategies. To conclude, the essay assesses how bilateral and multilateral relationships in the OEEC arena mutually contributed to the shaping of Italy and Britain’s patterns of post-WWII economic reconstruction.     

Whatever Happened to Industry Policy in Australia?

Since the 1980s and early 1990s, there have been few constructive developments towards a comprehensive and coherent productivity-enhancing agenda. Labor governments have often provided rhetorical support but have fought over whether industry policy represents a new protectionism or market-enhancing development policy. The Coalition in opposition and in office has generally opposed the idea of industry policy, but has continued to support ad hoc and costly policy interventions. Australia's 20 years without a recession has disguised the need to reconsider industry policy and questions of economic diversity. This article argues that dealing with problems of economic structure – particularly resource dependence and climate change adaptation – requires a revitalisation of the industry policy debate. It tracks the theory and practice of industry policy in Australia and concludes that advocates for industry policy must formulate new policy ideas outside the framework of the traditional divide between intervention and free markets.     

Chile's Export Diversification since 1960: A Free Market Miracle or Mirage?

Conventional wisdom has proclaimed Chile's recent economic development a ‘free market miracle’. In an examination of Chile's export diversification experience, this article departs from that view. By analysing the dynamics underlying the emergence of the salmon, fruit, forestry and wine sectors in Chile's export basket since the 1960s, the study sheds light on the crucial role of industrial policy in the process of capability accumulation that shapes new industries. The article undertakes a qualitative historical analysis of the scope and nature of policy interventions in each of the four sectors and conducts a quantitative policy evaluation using the difference‐in‐difference method. It finds that public institutions are essential in overcoming market failures inhibiting the emergence of new industries. Specifically, it shows that the government has a key role to play as a catalyst of human capital accumulation, as a venture capitalist, in trade promotion, and in ensuring ‘national’ sector reputation through a strong regulatory and quality control role. By elaborating on the dynamic process of structural transformation and capability accumulation, this article contributes to theoretical debates on the role of vertical policies in the emergence of new competitive sectors, and debates relating to static versus dynamic approaches to comparative advantage.     

Path dependence,policy learning and Australian manufacturing since the 1970s

The impending demise of passenger motor vehicle manufacturing in Australia provides a good opportunity to view the trajectory of industry policy since the Whitlam government commenced the process of tariff cuts in 1973. It is argued that industry policy over this period demonstrates the effects of path dependence and a lack of policy learning. In the industry policy context, the path dependence perspective suggests three key factors in explaining policy effects: the importance of initial conditions; the role of cumulative causation in the interaction between policy settings, actors and firms; and the shaping role of networks. While political or electoral factors could, on occasion, generate support for threatened industries, overall, neo-liberal policy ideas guided decision-making. An examination of Australian defence industry, and a comparison of the Australian and New Zealand dairy and milk processing industries reinforces the importance of institutionally shaped path dependency.     

Agricultural policy in Australia: deregulation,bipartisanship and agrarian sentiment

This paper provides an overview of the development of agricultural policy in Australia from a complex web of government intervention in the sector in the first half of the 20th century to the deregulation of the past 40 years. It highlights the close interrelationship between agricultural policy and manufacturing policy as well as the areas in which agricultural policy has been distinctive, namely the largely bipartisan nature of agricultural policy development and the strong cultural attachment across the community to farmers in general and family farming in particular. Recent policy debates suggest that agricultural policy will remain a sector apart in terms of the broadly bipartisan nature of policy and the ongoing influence of non-economic considerations. Australia will retain its comparative advantage in agricultural exports into the future and policymakers will need to continue to balance policies that support the economic performance of the sector with those that reflect community expectations of support for the farming community more broadly.     

Free trade in mad cows: how to kill a beef industry

Australia is the world's second largest beef exporter, dominating the highest value beef markets of Japan and Korea. Australia's competitiveness is underpinned primarily by its freedom from Bovine Spongiform Encephalopathy (BSE)—better known as ‘Mad Cow’ disease—thanks to strict animal feeding and importation regulations adopted in 1966. Why then would the Australian beef industry appear to agree to soften prohibitions on beef imports from BSE-affected countries, which would have the effect of opening Australia to BSE and potentially destroying its BSE-free status, along with its prime Asian markets? Our analysis begins with commitments that appear to have been made under the Australia–United States Free Trade Agreement. If our interpretation is correct, these commitments would compel Australia to accommodate US trade goals by recognising and adopting the weaker international standards on meat trade. To understand why the US would want Australia to abandon its stringent BSE safeguards, we consider wider US policy on BSE and beef exports, and its strategy for re-entering the valuable Japanese and Korean markets. To explain why the Australian beef industry might allow its interests to be sacrificed to serve US trade goals, we examine institutional and ownership features of the industry. Government pre-emption or ‘capture’, we suggest, explains industry subservience. The apparent willingness of the Australian government to sideline its country's economic interests in order to serve those of a foreign power raises the question of Australian exceptionalism.     

Does the economy matter? Economic perceptions and the vote in Australia

Does the economy matter for how Australians vote in federal elections? International studies show an association between economic performance and elections, but research on Australia finds that the impact of the economy on voting is modest. What explains this relative absence of economic voting? How do Australians perceive the economy? And how do economic perceptions inform their decisions at the polls? Our results confirm the lack of an association between economic indicators and incumbent vote shares. Analyses of survey data from 1996 to 2013 show that political factors condition perceptions of economic performance, while preferences for – and perceptions of – the government's unified control over economic policy shape the influence of economic perceptions on voter choice. Overall, responsibility attributions are the key to economic voting in Australia.     

‘Unity,stability, continuity’: heritage and the renovation of Franco’s dictatorship in Spain, 1957–1969

Spain between 1957 and 1969 – the period in the history of the dictatorial regime of General Francisco Franco known as desarrollista (development‐guided) – presents a peculiar case of a state‐driven heritage industry. The present article examines the desarrollista policy aimed at creating and coordinating heritage tourism, focusing on periodical publications, official speeches, films and promotional materials. It looks at late‐Francoist heritage as a vehicle for achieving, simultaneously, an ideological and an economic effect. Economically, heritage was conceived as a tool for diversifying and individualising Spain’s tourism product in the Mediterranean market, and above all, for confronting the uneven territorial and seasonal distribution of ‘sun and beach tourism’. At the same time, ideologically, the models and uses of heritage examined here served the regime’s interest in securing the country’s territorial unity, maintaining the high profile of the Catholic Church, and re‐legitimising the Civil War (1936–1939) which had brought Franco to power.     

Contestability ‘theory’, its links with Australia’s competition policy,and recent international trade and investment agreements

This article examines how contestable market theory (contestability) has come to reconfigure the economic and regulatory concept of competition in order to enhance the compatibility of Australia’s economy with international trade and investment agreements. Australia has recently negotiated and signed a raft of bilateral, plurilateral and regional agreements, including the Trans-Pacific Partnership Agreement and the Australia–China Free Trade Agreement. In order to ensure that Australia meets its obligations and commitments to these agreements, two key advisory bodies—the Harper Panel on Competition Policy Review and the Financial System Inquiry—made recommendations, the majority of which were accepted by the government, to ready Australia’s competition governance and economic policy for greater global integration. Such impact is dependent on, among other things, how domestic competition policy meshes with the free market ideology underpinning such international agreements, which favours the breakdown of barriers to markets. Less well known is the role of contestability in radicalising ideology as it countenances monopolisation and privatisation in the guise of market access by justifying the substitution of actual competition with the mere threat of competition. The article concludes that the monopoly power of transnational corporations will be enhanced through the acquiescence of governments to the new governance regime of the Trans-Pacific Partnership Agreement, which, supported by domestic policy, is set to redraw competition policy in the light of contestability theory.     

Knowledge-based development dynamics in less favoured regions: insights from Australian and Icelandic university towns

Knowledge-based development (KBD) is a widely practiced policy and is signified as an effective development approach particularly for the metropolitan city-region context. Even though, increasing recognition of this policy resulted in some initiatives in less favoured regions – such as regional university towns – its appropriateness for this context has not been investigated adequately. This paper explores the concept thoroughly in regional university town settings from the lens of the triple-helix model – a critical element for success in KBD. The study aims to broaden our understanding on the challenges of implementing a successful triple-helix model in regional university towns by providing evidence from different country contexts – Australia and Iceland. The methodology of the comparative case investigation incorporates policy and stakeholder perception analyses. Results reveal the journey of the investigated cases, their limited accomplishments and failure factors. Findings shed light on the developmental challenges of regional university towns by highlighting critical issues relating to suitability, appropriate implementation and effectiveness of the KBD policy.     

The economic consequences of economists

During 1991, disquiet with the policy recommendations and ultimate economic effects of economists began to feature in debates over economic policy in Australia. One example was the emergence of a conservative critique of economic liberalism; another was the publication of Michael Pusey's research showing that ‘econocrats’, notably those in the federal bureaucracy, have distinctive, politically significant attitudes to the role of government. This paper considers the influence of economic orthodoxy as part of a broader phenomenon—the peculiarity and underdevelopment of our public institutional framework. In Australia, forms of intervention required for full employment simply do not exist. This partially explains both our comparatively poor macroeconomic performance since the 1970s and the propensity of government to embrace policies that abrogate social democratic commitments while economic conditions worsen.     

Australia’s refugee policy: domestic politics and diplomatic consequences

ABSTRACT

Refugee policy involves a two-level game. For Australia since approximately 1998, the politics of refugees has been toxically affected by domestic politics. This has had potentially negative effects on Australia’s reputation and soft power. This article provides an overview of the issue, explores the ways in which considerations of domestic politics have come increasingly to shape Australia’s policy and concludes with a discussion of the consequences of Australia’s treatment of refugees for its diplomacy and soft power.     

Revisiting trade and industry policy

This paper introduces some of the recurrent themes of industry policy and debates about what governments can, might and should do – as well as have done – to foster desired patterns of economic development in a market economy. It does so by way of introduction to the four papers on Australian industry policy that make up this symposium.     

Globalising Economic Governance,Political Projects,and Spatial Imaginaries: Insights from Four Australasian1 Cities

This paper explores how territorial economic governance is discursively constituted in a globalising and neoliberalising world. It acknowledges both the increasingly recognised formative role of spatial imaginaries in economic interventions and the workings of co‐constitutive political projects that link particular imaginaries with political ambitions and policy strategies. Embracing recent calls for comparative ethnographic urban research at the local‐global interface, it explores currently dominant spatial imaginaries across the four Australasian cities of Auckland, Sydney, Melbourne, and Perth. Based on multiple qualitative methods, this study claims that a considerable number of actor's spatial associations and reference points can be related to particular city‐specific governmental projects; Auckland's Super‐City, Sydney's Global and Green City, Melbourne's Liveable City, and Perth's Vibrant City. It is demonstrated how discursive governance techniques such as ‘story‐telling’, benchmarking, and policy transfer have been pivotal in the activation, circulation, and performance of those spatial imaginaries and their transformation into temporarily dominant visions for strategic urban interventions aimed at repositioning urban actors, spaces, and activities. While spatial imaginaries can be related to differently framed global aspirations, the effects of spatial political projects on urban governance and investment trajectories differ significantly across space. Theoretically, the paper stresses the importance of particular conceptions of territorial relations and time‐ and place‐specific institutional mediation in shaping context‐dependent discursive material governance alignments.     

Trumping foreign policy: public diplomacy,framing, and public opinion among middle power publics

Even as the world’s sole superpower, the United States requires the cooperation of other states to achieve many of its foreign policy objectives. The President of the United States thus often serves as ‘Diplomat in Chief’ in public diplomacy efforts to appeal directly to publics abroad. Given Donald Trump’s antagonistic approach to foreign relations and widespread lack of popularity, what are the implications for support for US policy among publics abroad – particularly among middle power states allied to the US? While previous research on public opinion relying on observational data has found that confidence in the US President is linked to support for American foreign policy goals, the mechanisms at work remain unclear. Using original data from survey-based experiments conducted in Canada and Australia, this article seeks to clarify the effect of ‘presidential framing’ (presenting a policy goal as endorsed or not endorsed by Trump) on attitudes toward key policy issues in the Canada–US and Australia–US relationships. Results point to a negative ‘Trump framing’ effect in Canadians’ and Australians’ trade policy attitudes, but such an effect is not observed in other policy domains (energy policy in Canada, and refugee policy in Australia).