Post–World War Two industry policy: opportunities and constraints

Abstract

There exists an entrenched conventional wisdom that, for the first seventy years of the twentieth century, Australia was closed to the global economy in the pursuit of an inward–looking and market–defying approach to development. This interpretation is neglectful of the broad forces at work and their evolution. The economic policy process inevitably embodies compromise between conflicting views and interests, including bureaucratic rivalries. An investigation of the role and treatment of the post–War industry bureaucracy provides some insight into the character of the contemporary balance of forces. Post–War development certainly involved dysfunctionalities, but the causes were located in a complex set of determinants rooted in culture rather than just inwardness or rent seeking. Thus, the importance of the protective tariff for the manufacturing sector in the 1960s deserves to be reinterpreted as a symptom rather than the cause of any underlying problems with policy character and policy priorities.