11 Dec Australia’s falling living standards – what’s driving it and how to fix it
Key Points
- Falling real wages and a surge in tax and interest payments have led to a slump in Australian living standards.
- But a broader driver of the malaise in living standards has been a slump in productivity growth from over 2% pa in the 1990s to near zero since 2016.
- Key policies to boost productivity growth include: tax reform; a cap on public spending as a share of the economy, deregulation; greater incentives to invest; and competition reforms.