This paper discusses the importance of asset markets and financial flows in general equilibrium models. Asset markets and financial flows play an important role in the adjustment process to economic shocks and policy changes.
Indonesia faces a number of important challenges both in the short run and in the longer run. The world economy is currently growing robustly but a number of uncertainties cloud the economic outlook. A strong global economy is being challenged by higher oil prices.
In Sensible climate policy Professor Warwick McKibbin criticises the Kyoto Protocol that had just entered into force in February 2005. He predicts that the policy would not succeed in reducing emissions and argued that it was a mistake to continue to follow the ‘targets and timetables’ approach
India's exploding demand for energy is confronting New Delhi with two important dilemmas. India's internal dilemma is that to satisfy its energy needs, it must balance reform and expansion of its energy sector with the need to avoid alienating key domestic constituencies.
Anthony Bubalo and Mark Thirlwell examine China and India's growing thirst for imported oil, particularly from the Middle East, and consider some of the possible longer term strategic implications associated with this trend.
Anthony Bubalo, research fellow, argues that Yasser Arafat's death could have longer term positive implications for both Palestinian political reform and efforts to resolve the Israeli-Palestinian conflict, but in the short term the impact will be more limited. Arafat's immediate successors will not
Although there are significant differences in style and substance between George Bush and John Kerry, the similarities in foreign policy terms are more striking than is sometimes understood. From Australia's perspective, the fundamentals of our relationship with the US are excellent and the alliance
This Issues Brief by Professor Warwick McKibbin and others explores the causes of the transpacific trade imbalances using an empirical global model. It also evaluates the impact of various policies to reduce these imbalances.
Depending on the way we look at the world at present it is possible to see the international system as unipolar or multipolar, as intensely inter-connected or deeply divided. Each of these angles of view reveals important truths about the global environment.Allan Gyngell looks at the lessons
John Bowan, a former senior Australian foreign policy official, and consultant to Beijing's successful Olympic bid, examines how Beijing and China won the 2008 Games and what this will mean for China and its position in the world.The 2008 Olympics will open China to unprecedented international
The prediction of future temperature increases depends critically on the projections of future greenhouse gas emissions. Yet there is a vigorous debate about how these projections should be undertaken and how reasonable is the approach of the Special Report on Emissions Scenarios (SRES) published by
While the global environment waits for the world to reach some form of agreement on climate policy, developing countries such as India are entering a phase of higher economic growth. The decisions on investment in energy systems that will be made in India in coming years will have an important
On 8 February Australian Trade Minister Mark Vaile concluded an agreed text for an Australia-United States Free Trade Agreement. This Issues Brief provides a preliminary assessment of the agreement, based on the limited information now available
The outbreak of SARS in late 2002 has alerted the world to the potential economic costs of epidemics. The purpose of this paper is to provide an assessment of the global economic impacts of the SARS disease as well as provide a more comprehensive approach to estimating the global consequences of
This Issues Brief suggests that a key theme over the past year has been the management of external imbalances in a world economy that is not only increasingly integrated but which is simultaneously undergoing a sustained geographic shift in the distribution of economic weight towards Asia
Developments including the rise of vertically specialised trade and the growing internationalisation of production, broader and deeper goods and financial market integration, the extension of international trade to the previously “non-tradeable” services sector, and the spread of international
The post-World War II international trade policy framework is being challenged by a proliferation of bilateral and regional trading arrangements. Australia faces a choice over whether to join this preferential trade bandwagon and risk collateral damage to the multilateral trading system, or to go no
Southeast Asian industrial exports are now facing intense competition from Chinese industrial exports. How much more would competition increase with China's recent accession to the World Trade Organization? Would Indonesia, Malaysia, Philippines and Thailand (the ASEAN-4) de-industrialise and return
In this paper we update our earlier estimates of the cost of the Kyoto Protocol using the G-Cubed model, taking into account the new sink allowances from recent negotiations as well as allowing for multiple gases and new land clearing estimates.