Australia vs. China: An Economic Comparison

1455 Words6 Pages
Australia and China adopt very different economic systems in order to cater the best for their society. However, Australia's economic system is more successful than China's and, due to the writer's right-wing value system, will be measured in terms of environmental efficiency, labour and entrepreneurial resource efficiency and the standard of living.

The basic economic problem for any country is that resources are scarce while wants are infinite. This means that countries must decide what to produce, how to produce and for whom to produce in the most efficient and equitable way possible. Australia and China both take different approaches to solving this economic problem, even though both can technically be classified as a mixed economy
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Australia's power distribution is very effective with very few blackouts and 24 hour assistance in case of emergencies (Metcalfe, 2007). Like any other country, Australia has environmental issues however it is trying to become more environmentally friendly and efficient. Australia is building more infrastructure and becoming more environmentally friendly. China on the other hand does not have effective energy distribution. Blackouts are a common thing in China due to the overwhelming demand for energy (Xinzhang, 2007). Right now China faces the problem that there is not enough transmission capacity to provide additional supplies which results in poor distribution. Coal is the main resource used for energy supply in China by a staggering 63.4% compared to 6.9% hydroelectricity (China Today, 2005). Coal use in Australia is significantly less than this with only 42% of its energy source being coal (Metcalfe, 2007). China has overwhelming carbon dioxide emissions, so overwhelming that China is accountable for 15% of the world's emissions (World Fact book, 2007). This has very negative social costs with acid rain being a frequent problem for China. 5% of China's GDP is spent on trying to fix the social costs of pollution (China Today, 2007). Not only is this not statically efficient, but it is not dynamically efficient either. Therefore, even though both countries have environmental issues, Australia is able to provide a better power supply
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