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> resource curse The service sector makes up 62% of the Australian economy.

by acchow 4y ago

robocat 4y ago
Australia’s service sector makes up ~20% of exports - the resource curse is related to import/export, not internal measures. Total exports 2019-20: 383G$ goods, 92.3G$ services https://www.dfat.gov.au/publications/trade-and-investment/trade-and-investment-glance-2021 https://www.dfat.gov.au/publications/trade-and-investment/tr...
- acchow 4y ago
  Wikipedia has an articel on the Resource Curse: https://en.wikipedia.org/wiki/Resource_curse https://en.wikipedia.org/wiki/Resource_curse It is about having "less economic growth, less democracy, or worse development outcomes than countries with fewer natural resources". Australia is an advanced services based economy. No one would consider them as an example of a country under a "resource curse" By your measure, Japan also has a resource curse because services makes up 22% of exports?
  - samatman 4y ago
    No, Japan makes stuff.
  - robocat 4y ago
    Here is a more interesting graph https://www.rba.gov.au/education/images/explainers/trends-in-australias-balance-of-payment/trends-in-australias-bop-03.svg https://www.rba.gov.au/education/images/explainers/trends-in... from [1] which shows Australia’s resource exports increasing drastically by percentage over the years, and the percentage for the other export sectors declining (agricultural, services, manufacturing, other). That graph seems to show services have dropped to ~12% of exports which is stunning. Whether that graph says anything about Australia and the resource curse is graduate level analysis - I don’t have any opinion either way. I felt your reply was a strawman, or putting words in my mouth? I only pointed out a figure with no implication of analysis, because your figure of internal services was completely irrelevant. Note even countries with the resource curse still internally have cafes, and concerts, and mining support crews. PS: NZ probably isn’t doing much better. Service exports seem lowish, and half of our service exports is tourism: https://oec.world/en/profile/country/nzl#trade-services https://oec.world/en/profile/country/nzl#trade-services [1] https://www.rba.gov.au/education/resources/explainers/trends-in-australias-balance-of-payments.html https://www.rba.gov.au/education/resources/explainers/trends...
    - acchow 4y ago
      I think I skipped a few steps in my first comment. Let me break it down. 1) Countries are considered to be under a "resource curse" if they are unable to reach advanced economy status because of hindered growth over long periods of time caused by an abundance of resources. If a country is an advanced economy, it is not under a "resource curse" 2) One measure of how advanced an economy is is the GDP per capita. I don't think this is really sufficient tho because you can imagine a country that is so abundant in, say, oil that they do nothing but extract oil and STILL reach a GDP per capita of $30k. They can do this all without any advancement of their economy, and they can use imports to satisfy their desire for consumption. 3) So I actually prefer an alternative measure of "advanced economy" - the majority of the economy is service based. Because Australia meets criteria 3, it is an advanced economy. (Australia also has a high GDP per capita, in case criteria 2 is more convincing to you). You could propose that Australia will become resource cursed in the future if its other sectors stop growing over long periods and resource extraction continues to grow - eventually to the point that the services sector no longer represents the majority of output. I think this is possible but unlikely. And it would take a very long time....
      - robocat 4y ago
        To repeat myself: you are arguing against a point I have not made, and I am certainly not saying that Australia has resource curse. That said, I will respond to yet another of your non-sequitur comments: the first heading in the Wikipedia article is about a type of resource curse called https://en.m.wikipedia.org/wiki/Dutch_disease https://en.m.wikipedia.org/wiki/Dutch_disease which does apply to advanced economies and could be relevant to Australia. My guess is that samatman is just saying that Australia’s increasing dependence on resource exports could have negative outcomes - a grey area rather than black & white thinking one or t’other. I would guess he isn’t suggesting 100% resource-curse (or Dutch Disease), but that the needle could move from 10% resource-curse to 30% resource-curse. The graph of percentage agricultural exports in the link I gave is what should be worrying - could resources have the same trend in value? Given that there are other first world countries (like Norway and petroleum) that seem to be managing their resource wealth, hopefully Australian politicians can avoid problems too. Australia’s people rely on exports and imports for their first world benefits. How many years would it take to become third world if the borders were closed? Disclaimer: I am not an economist, nor do I respect most people in that profession, but there are a few economists who are amazing and it can be a science.
samatman 4y ago
Give it enough time and you can all provide services to the Chinese, in exchange for technology and goods. I'm sure they need services, and not just raw materials they can turn into products and sell to everyone, rather than Australia in particular. But you'll service them with services. Australian services, to be clear. Very in-demand trade good. Much like raw lithium, and batteries, that way. Everyone wants Australian services.

> resource curse The service sector makes up 62% of the Australian economy.

by acchow 4y ago

> resource curse The service sector makes up 62% of the Australian economy.

Australia’s service sector makes up ~20% of exports - the resource curse is related to import/export, not internal measures. Total exports 2019-20: 383G$ goods, 92.3G$ services https://www.dfat.gov.au/publications/trade-and-investment/trade-and-investment-glance-2021 https://www.dfat.gov.au/publications/trade-and-investment/tr...

acchow 4y ago
Wikipedia has an articel on the Resource Curse: https://en.wikipedia.org/wiki/Resource_curse https://en.wikipedia.org/wiki/Resource_curse It is about having "less economic growth, less democracy, or worse development outcomes than countries with fewer natural resources". Australia is an advanced services based economy. No one would consider them as an example of a country under a "resource curse" By your measure, Japan also has a resource curse because services makes up 22% of exports?
- samatman 4y ago
  No, Japan makes stuff.
- robocat 4y ago
  Here is a more interesting graph https://www.rba.gov.au/education/images/explainers/trends-in-australias-balance-of-payment/trends-in-australias-bop-03.svg https://www.rba.gov.au/education/images/explainers/trends-in... from [1] which shows Australia’s resource exports increasing drastically by percentage over the years, and the percentage for the other export sectors declining (agricultural, services, manufacturing, other). That graph seems to show services have dropped to ~12% of exports which is stunning. Whether that graph says anything about Australia and the resource curse is graduate level analysis - I don’t have any opinion either way. I felt your reply was a strawman, or putting words in my mouth? I only pointed out a figure with no implication of analysis, because your figure of internal services was completely irrelevant. Note even countries with the resource curse still internally have cafes, and concerts, and mining support crews. PS: NZ probably isn’t doing much better. Service exports seem lowish, and half of our service exports is tourism: https://oec.world/en/profile/country/nzl#trade-services https://oec.world/en/profile/country/nzl#trade-services [1] https://www.rba.gov.au/education/resources/explainers/trends-in-australias-balance-of-payments.html https://www.rba.gov.au/education/resources/explainers/trends...
  - acchow 4y ago
    I think I skipped a few steps in my first comment. Let me break it down. 1) Countries are considered to be under a "resource curse" if they are unable to reach advanced economy status because of hindered growth over long periods of time caused by an abundance of resources. If a country is an advanced economy, it is not under a "resource curse" 2) One measure of how advanced an economy is is the GDP per capita. I don't think this is really sufficient tho because you can imagine a country that is so abundant in, say, oil that they do nothing but extract oil and STILL reach a GDP per capita of $30k. They can do this all without any advancement of their economy, and they can use imports to satisfy their desire for consumption. 3) So I actually prefer an alternative measure of "advanced economy" - the majority of the economy is service based. Because Australia meets criteria 3, it is an advanced economy. (Australia also has a high GDP per capita, in case criteria 2 is more convincing to you). You could propose that Australia will become resource cursed in the future if its other sectors stop growing over long periods and resource extraction continues to grow - eventually to the point that the services sector no longer represents the majority of output. I think this is possible but unlikely. And it would take a very long time....
    - robocat 4y ago
      To repeat myself: you are arguing against a point I have not made, and I am certainly not saying that Australia has resource curse. That said, I will respond to yet another of your non-sequitur comments: the first heading in the Wikipedia article is about a type of resource curse called https://en.m.wikipedia.org/wiki/Dutch_disease https://en.m.wikipedia.org/wiki/Dutch_disease which does apply to advanced economies and could be relevant to Australia. My guess is that samatman is just saying that Australia’s increasing dependence on resource exports could have negative outcomes - a grey area rather than black & white thinking one or t’other. I would guess he isn’t suggesting 100% resource-curse (or Dutch Disease), but that the needle could move from 10% resource-curse to 30% resource-curse. The graph of percentage agricultural exports in the link I gave is what should be worrying - could resources have the same trend in value? Given that there are other first world countries (like Norway and petroleum) that seem to be managing their resource wealth, hopefully Australian politicians can avoid problems too. Australia’s people rely on exports and imports for their first world benefits. How many years would it take to become third world if the borders were closed? Disclaimer: I am not an economist, nor do I respect most people in that profession, but there are a few economists who are amazing and it can be a science.

samatman 4y ago

Give it enough time and you can all provide services to the Chinese, in exchange for technology and goods. I'm sure they need services, and not just raw materials they can turn into products and sell to everyone, rather than Australia in particular. But you'll service them with services. Australian services, to be clear. Very in-demand trade good. Much like raw lithium, and batteries, that way. Everyone wants Australian services.