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This paper introduces some of the recurrent themes of industry policy and debates about what governments can, might and should do – as well as have done – to foster desired patterns of economic development in a market economy. It does so by way of introduction to the four papers on Australian industry policy that make up this symposium. [ABSTRACT FROM PUBLISHER]

The debate over the political power of business has witnessed a revival after the global financial crisis of 2007—2009. We begin by arguing that business political fragmentation or unity has important consequences for policy outcomes. The structure of the U.S. government is conducive to incremental policy changes, often in response to business pressures. In turn, these changes shape the political interests and alliances of business. We illustrate this dynamic through an analysis of the political processes leading to the enactment of the Financial Modernization Act (FMA) of 1999, which repealed Depression-era regulations and allowed commercial banks to enter the securities and insurance business and vice versa. The FMA condoned the emergence of largely unregulated diversified financial institutions, which proved “too big to fail” during the crisis. Several factors contributed to the FMA: political institutions, international competition, the ideological convergence of the Republican and Democratic parties, and the political interests of financial industry actors. [ABSTRACT FROM PUBLISHER]

This article examines changes in the New Labour core executive's approach to regulation and its relationship with risk, through analysing documentary, legislative and press sources concerning approaches to regulatory decision-making. It claims that an initial commitment to ‘better regulation’ has gradually been replaced by explicit support for deregulation. A reduction in the scope of regulation was also promoted by the Thatcher and Major governments. The New Labour core executive shares previous (Conservative) administrations’ concern to include business in deregulatory decision-making. However, the article claims that there is one significant difference in the New Labour deregulatory approach: a new toleration of risk. Deregulation is, now, described as a corrective to regulators’ over-reactions to perceived risks, which, it is claimed, are holding back economic and technological progress. However, this new approach excludes competing views concerning how risk should be regulated. In particular, it does not engage with widespread popular views that governments should continue to protect against risk. [ABSTRACT FROM AUTHOR]

The regulating agencies are a very important topic in any nation economy, the reason: that is the way the Estate can intervene the economy in a technical and specialized approach in order to achieve efficiently. However, this situation could produce a failure itself in the nation's economy. That is why it must exist a wise combination between the participation of the Estate and the participation of the market, so it won't be any failure because of the excess of one or other. [ABSTRACT FROM AUTHOR]

The dissolving trade barriers, financial deregulation, hyper-mobility of capital and the rapid diffusion of new information technologies have ushered the Australian economy into the borderless world. The orthodoxy that states that centralised wage-fixing in Australia has impeded wage flexibility and resulted in high unemployment is unconvincing. Partly, this is because in the 1980s Australian labour market institutions have been decentralised and decollectivised in response to pressures from the borderless world. The insights garnered from cross-sectional comparative statics that, first, skill-biased Schumpeterian technological change was the major cause of labour immiserisation and, second, adverse Stolper-Samuelson trade played an insignificant effect need to be reviewed. Parsimonious dynamic time-series models of trade and technology have been formulated using general-to-specific methods after taking account of stochastic trends through unit root and cointegration tests. Granger causality and non-nested tests applied to these models support the contention that both trade and technology contributed to increasing wage disparity during the borderless era. Moreover the supply side factors such as female participation, immigration and institutional factors such as deunionisation have also increased wage disparity. The deregulation of the Australian labour market by the Workplace Relations Act, whilst an inevitable response to achieve competitiveness in the borderless world market, would exacerbate wage inequality. Policies aimed at skill accumulation on the one hand, and social welfare policies involving negative income taxes on the other may have to be implemented to mitigate the deleterious social effects of rising wage inequality. [ABSTRACT FROM AUTHOR]