Saturday, August 11, 2007

How long's a piece of string...

The Australian Chamber of Commerce and Industry have published some economic modeling as part of their scaremongering against Labor. They had to do it really, the Lib's credibility is shot to pieces by continual rate rises giving the lie to their promise to keep interest rates at "record lows". But it's value is very limited - it'll get plenty of media attention and allows them to erect banners around the country claiming that 316,000 jobs are at risk but it's frankly ridiculous.

The study, conducted by Econtech, is premised on comparing a continuation of the Coalition's IR laws with a complete roll-back of all industry reform since 1993 - including the Keating-led Labor government's Industrial Relations Reform Act - this is a false premise and it totally undermines the value of the report. No party, certainly not Labor, propose a restoration of the archaic and inflexibility of the '80s so what is the point of this exercise?

Professional economists clearly do not have sufficiently high professional standards. If they did, they'd attempt a more meaningful exercise and examine the anticipated economic effects of Labor's proposed IR reforms compared with the Coalition's.

I'm not a professional economist, but have worked with them including on a project that estimated the economic value added by TAFE NSW, and I am fully aware of the way in which deprival econometric modeling is done - but I also know that the limit to this approach is the validity of the underlying assumptions. In this instance, the assumptions bare no relation to reality.


Anonymous said...

Interesting times in aussie. I actually think the scaremongering against "Labor", is valid. A Gillard agenda would be disastrous for industry in Oz. Rudd though is a pragmatist, Blair of the south. His premiership i think is inevitable. It will be interesting to speculate about it.

Great Blog

Anonymous said...

I've worked with Econotech, I think..