CAPITAL INPUTS
The 2002-03 drought also appears to have been something of a catalyst for structural change in the input mix. While total hours worked was falling at unprecedented rates, average annual growth in capital services over the three years following the 2002-03 drought was greater than in any previous year. This suggests that the 2002-03 drought, coupled with an increasingly competitive labour market, may have prompted firms to substitute labour with new capital.
Figure 3.4 further supports the proposition that capital formation was a feature of the industry in the years following the 2002-03 drought. Gross fixed capital formation in the years following the 2002-03 drought was unusually high. While new investment in livestock was a notable feature of this upturn, it was also concentrated in machinery and equipment and there was a continued upward trend from before the drought in non-dwelling construction.
3.4 Agriculture, Forestry & Fisheries Gross fixed capital formation, Chain volume measures (a)
Print Page
Print All