Australian Economic Growth Path: 2005-2014

Running head: ECONOMICS ASSIGNMENT
Economics Assignment
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2ECONOMICS ASSIGNMENT
Introduction:
Among many mixed economies around the world, Australia is one of the largest one
which is going through transformation through the last two and half decades. Considering the
case of the various macroeconomic parameters of the state it can be argued that economy of
Australia has been moving forward at a speedy frequency and in present date, Australian
economy is one of the most stable economies around the world. Australia during the present
date has been going through its 27th consecutive year of growth that has been started since the
1990s with the transformation of the economy from a mining based economy to the tertiary
sector based economy (Downes et al., 2014). Considering the nominal Gross Domestic
Product (GDP), it can be seen that Australia stands 19th and as per the PPP model, rank of the
economy is 14th showcasing the stability and the size of the economy (Rees et al., 2016).
Considering the growth path of the Australian economy, it can be seen that, with the fall in
the export of the coal in the international market, growth of the Australian economy has been
hampered to some extent, however, it has good amount of stability and ability to sustain the
market crunches. With the substantial amount of job creation and labour force participation,
Australian economy during the last one decade has moved forward by a large extent. In
addition to this, latest exploration of the tech metals and the energy resources in the
Australian mines has been aiding the economy to leap bound its growth.
Under this scenario, this essay is aimed to describe the Australian growth path during
the last one decade ranging from 2005 to 2014. In addition to this, this essay will portray the
various government reformation in order to gauge the unemployment and inflation rate of the
economy during the same period (Rahman & Mamun, 2016). Moving forward, the essay is
aimed to put light on the various macroeconomic factors like real GDP, real GDP growth
rate, inflation and unemployment in order to forecast the future of the Australian economy
and to conclude, the essay will provide a summarised synopsis of the findings..

3ECONOMICS ASSIGNMENT
Production output performance analysis:
Australian economy during the recent decade has been moving forward with a great
pace and figure 1 depicts the same. As it can be seen from the figure 1, real GDP of the
economy has been moving with a positive slope during 2005 to 2014 depicting good amount
of growth of economy during the selected time frame. As it can be seen that, figure 1 has
been drawn at a constant price of 2010, effect of the Global Financial Crisis (GFC) took place
during 2008 has not been revealed through the diagram below (Manalo et al., 2015).
However, it is true that there has been some degree of fall in the real GDP of Australian
economy, during the 2008 to 2010. With the aid of the government packages and
enhancement in the expenditure, economy of the Australia has managed to have positive real
GDP growth.
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
0
200000000000
400000000000
600000000000
800000000000
1000000000000
1200000000000
1400000000000
Real GDP
Figure 1: Real GDP of Australia
Source: (Australia Data, 2018)
In order to understand the real scenario of the Australian production sector, figure 2
can be considered, where the real GDP growth rate has been showcased. As the figure 2
depicts, there has been fall in the real GDP growth rate, during 2005 to 2006 due to fall in the

4ECONOMICS ASSIGNMENT
mining production (Reedman et al., 2018). Post, that there has been rapid boom in the
agricultural sector as well as the production of the tech metals from the Australian mining has
been aiding the economy to earn more amount of goods and services. It has aided the real
GDP growth rate to rise during the two years. During 2008, as the GFC hit the world market,
demand of the Australian goods and services started to reduce that has reduced the real GDP
growth rate depicted by a sharp fall in the real GDP growth rate since 2008 to 2010
(Schroeder, 2018). Next to this, there has been various stimulus packages from the
government that has aided the economy to enhance its real GDP growth. Since 2012, there
has been mining boom in the form of energy resource that has aided the economy to enhance
its real GDP growth as shown in the figure 2, with a sharp rise in the real GDP growth rate
line. Presently, with the moderate amount of growth of the economy, real GDP growth rate
has been enhancing marginally and the productivity of the economy has also sustainable as of
now (Rehman & Mamun 2016).
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
Real GDP growth rate
Figure 2: Real GDP growth rate
Source: (Australia Data, 2018)
Real GDP per capita is another major macroeconomic indicator that depicts the per
capita income of the economy. Higher per capita income means, better standard of living and