Is the public sector dragging down living standards?
Abstract
Abstract This paper takes issue with the proposition that low productivity growth in the non-market sector is dragging down Australia’s living standards. To do that, we revisit an old debate that showed that wages should be adjusted for productivity in the market sector alone. That was the argument put by John Nevile and used by the ACTU in the 1975 national wage argument that resulted in quarterly wage indexation. Discounting wages for the lower productivity in the non-market sector causes macroeconomic stress as it prevents wage-earners from purchasing as much of the market sector’s output.
Fields of Study & Subjects
Australian History and Society
New Zealand Economic and Social Studies
Economic
financial
and policy analysis
Publication details
- Journal / source
- The Economic and Labour Relations Review
- Publisher
- Cambridge University Press (CUP)
- Volume
- 37
- Issue
- 1
- Pages
- 46–58
- Publication date
- 1 March 2026
- Language
- EN