Wage policy perspectives on the accord / B.J. Chapman.

Abstract

Given the recent extension of the Accord, the time is opportune to assess, as far as is possible, what the macroeconomic consequences have been of Australia's first consensual incomes policy. This is one aim of the current paper and it is assisted considerably by placing the Accord in historical contect. Judgement of the Accords success or otherwise is a challenging exercise, in part because the relevant question concerns what outcomes would have been in its absence. Some progress is made by considering recent performance relative both to other periods and to the major OECD countries. The evidence, qualified as it is, seems to suggest that the Accord has contributed favourably. A second goal of the paper is to investigate the validity of recent claims that the Accord has been faltering. For conceptual and measurement reasons it is argued that no compelling evidence exists for such an assessment. Third, the paper examines the challenge to the Accord of devaluation, and the government's tax-wage bargain solution to the dilemma posed by the problem. Show more