Assessing the Importance of National Economic Reform – Australian Productivity Commission Experience

The Australian Productivity Commission is the Australian government’s principal review and advisory body on microeconomic policy reform and regulation. Under its Act of Parliament, the Commission provides objective advice to inform policy decisions. It undertakes public inquiries and supporting research, and publishes its advice. An important part of the Commission’s work has been to report on the potential economic benefits of national reform programs in Australia. The Commission’s investigations are supported by economic modelling of reforms. This modelling adopts an economy-wide approach and demonstrates that well structured reform can deliver substantial economic benefits, including higher incomes to regions and across household groups. To achieve the productivity potential, the market needs to be flexible so that labour and capital can choose to move to areas of greatest opportunity.