Harvard economics Professor David Glaeser has an interesting editorial on the role of mining in Australia, published yesterday by Bloomberg. The basic thrust of his argument is that capital-intensive coal and iron ore industries dominate Australian exports, but harm long-term competitiveness. He mentions two main causes. The first is the role of natural-resource-led exports bidding up the value of Australian dollars (sometimes referred to as the "Dutch Disease"), making it more difficult for other sectors to be competitive. This dynamic is important, but is not particularly novel: it h
I should have linked to this last month, but better late than never. Robert Rapier has done a nice review of the Renewable Fuel Association's rather exuberant claims on the impacts of killing VEETC. Given that the mandate still requires the use of almost all of the ethanol produced domestically, the mechanism of support may shift (from tax credits to transfers from consumers, as illustrated by rising prices on compliance credits under the renewable fuel standard) but the demand will remain.