Macroeconomic consequences of terms of trade episodes, past and present

Vol: 
11/2014
Author name: 
Atkin T
Caputo M
Robinson T
Wang H
Year: 
2014
Month: 
January
Abstract: 

The early 21st century saw Australia experience its largest and longest terms of trade boom. This paper places this recent boom in a long-run historical context by comparing the current episode with earlier cycles. While similarities exist across most episodes, current macroeconomic policy frameworks and settings are quite different to those of the past. This mitigated the broader macroeconomic consequences of the upswing and as the terms of trade decline may do likewise.

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