The report, Standards, innovation and the Australian economy, undertaken by the Canberra based Centre for International Economics studies the impact of standards on the Australian economy. It is part of Standards Australia's submission to the Australian Productivity Commission research study into the relationship between the Australian Government and the Australian standards and accreditation infrastructure. The report investigates both the micro and macro economic impact of standards. Mr John Tucker, Standards Australia CEO, said that the conclusions drawn make a clear case for the benefits of standards to the Australian economy. “This report, for the first time, puts a dollar value on the impact of standards across some of our most important industries and also measures the economy wide benefits.” “And the result is clear: standards are helping generate profits and creating jobs in Australia.”
Key findings
The macro level study examines standards at an aggregate level, using a statistical approach that tries to explain changes in economy-wide productivity. It indicates that there is a relationship between the stock of standards and productivity:
- Over the 40 years to 2002 a 1 percent increase in the number of Australian Standards is associated with a 0.17 per cent increase in productivity across the economy.
- Additionally, standards can be considered, together with R&D expenditure, as contributing factors to the stock of knowledge, and the study finds that a 1 per cent increase in this joint stock of knowledge leads to a 0.12 per cent increase in economy-wide productivity.
At the micro level, case studies further indicate the effects of standards. Four groups of standards are examined including: sample standards in the mining industry; standards in water and electrical industries; and the risk management standard.
The report finds that water and electrical standards generate economic benefits of around $1.9 billion a year while mineral sampling standards generate benefits between $24 million and $100 million a year.
Other demonstrated benefits are that standards:
- Distil and diffuse knowledge;
- Provide a common language for discussion;
- Underpin markets and help solve some externality problems;
- Underpin innovation and knowledge dissemination;
- Reduce costs of production and increase productivity;
- Help provide safety outcomes and assist with risk management.
The findings are consistent with similar studies undertaken by in
Britain in 2005 and in
Germany in 2000. Like these studies, it is based on limited data.
