My understanding is that this approach also predicts that Australia would experience a recession around 2008. How would the Austrian approach explain the absence of such a recession?
Australia did go into recession. Well, in aggregate, the country didn’t. But per capita GDP dipped by 13% over 2009 (currently trying to find more detailed (quarterly, monthly) stats, will link when found).
The reason this change was not registered by GDP proper is because the Australian population increased commensurately over this time, and most of this was in immigration—Australia’s population at the time (2007) was 20.9m, and at its peak the Australian population was increasing, calculated at 450k per year in the critical period.
My understanding is that this approach also predicts that Australia would experience a recession around 2008. How would the Austrian approach explain the absence of such a recession?
Australia did go into recession. Well, in aggregate, the country didn’t. But per capita GDP dipped by 13% over 2009 (currently trying to find more detailed (quarterly, monthly) stats, will link when found).
The reason this change was not registered by GDP proper is because the Australian population increased commensurately over this time, and most of this was in immigration—Australia’s population at the time (2007) was 20.9m, and at its peak the Australian population was increasing, calculated at 450k per year in the critical period.