Ladies and gentlemen, as Treasurer of Australian government, I would like to talk about the important role of government in achieving domestics stability. I will show the following issues that how the government fulfills domestic economic stability: the three main economics objectives; how the government assesses whether these objectives are being achieved; emphasize the recent trends; how these objectives are interrelated, and lastly why I think the objective of price stability should be the most important for the government.
As we known, Australia is a mixed economy, which is mixed of pure market and command systems. The private decision-making and ownerships while having a central organization, because of the government intervenes and control economic resources, and public facilities. There have three economic functions of the government; allocation of resources (normally, the government can use different types of reallocate resources and raise income; redistribution of income and welfare payment; the last one is stabilisation of economic activity.
As for me, I am concerted with the last point, which is the function of stabilising the economy and discuss it.
The role of the government in achieving stability of the economy have to use fiscal and monetary policy. Our federal government has 9 main economic objectives, there are: fulfilling full employment rate, maintaining price stability, constant economic growth, maintaining environment standards, external balance, equitable tax burden, equitable income distribution, economic security and freedom for the economy. Nevertheless, today, we just focus on first 3 main objectives.
Achieving successfully full employment when those who are willing and able to work can find a job. Natural rate of unemployment exist of frictional and a certain amount of structural unemployment, towards which economy automatically gravitates in absence of other disturbances. Full employment can also undermine the economic conditions needed for economic growth. The economic growth...