The Impact of Federation on Australia's Trade Flows

Douglas A. Irwin

NBER Working Paper No. 12160
Issued in April 2006
NBER Program(s):   DAE   ITI

In 1901, six Australian states joined together in political and economic union, creating an internal free trade area and adopting a common external tariff. This paper investigates the impact of federation on Australia's internal and international trade flows by studying changes in the "border effect" over this time. This is possible because Australian states reported intra-Australian trade prior to 1901 and for eight years after federation. The results indicate that federation itself produced little change in Australia's trade patterns, but that the border effect increased substantially between 1906 and 1909 when the protectionist Lyne Tariff was imposed.

(166 K)

Published: Douglas A. Irwin, 2006. "The Impact of Federation on Australia's Trade Flows," The Economic Record, The Economic Society of Australia, vol. 82(258), pages 315-324, 09.

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