THE IMPACT OF THE ECONOMIST UPON TARIFF POLICY IN AUSTRALIA: A HALF CENTURY OF TARIFF DEBATE (ECONOMIC, THOUGHT, (1929-1979))

Australian economic thought on tariffs underwent a remarkable transformation between the 1920s and 1970s. In the twenties a group of orthodox economists developed a cogent case for protection which endorsed the government's tariff policy. By the seventies however, the economics profession in Australia no longer supported this and advocated freer trade. This dissertation explains the evolutionary process in the intellectual history of that country during a fascinating period of economic development. It highlights the interaction between thought, policy, experience and changing circumstances. In analysing the social relevancy of that thought the impact of the economist upon policy is assessed.;As the institutional circumstances and state of development changed, so too did the intellectual support for the original model. In the light of the Keynesian fiscal revolution other tools became available and acceptable. Developments in the theory of domestic divergences from the mid-sixties onwards enabled free trade to become unencumbered from its nexus with laissez faire.;As the basis for the early model withered away, trade liberalization became an accepted objective. But a new debate appeared over the costs of structural adjustment particularly as pervasive unemployment from the mid-seventies onwards led to political intransigence. Thus unlike the early stages of the debate rifts appeared between the views of economists and politicians.;The social relevancy of economic thought on tariffs is a distinguishing feature throughout the period under review and the economists played an active role in policy formulation. The task remains for current Australian economists to continue this tradition by devising politically acceptable plans for reform which meaningfully integrate the present day institutional fabric of their society into their recommendations.;The early case for protection overcame the shortcomings of the static orthodoxy by creatively combining the terms of trade effect, and in anticipation of the general form of the Stolper-Samuelson theorem, with an income distribution aspect, together with dynamic externalities. This model revealed that tariffs were an effective instrument of economic development for the Australian community.