Macroeconomic policies Macroeconomic policies should concentrate on medium-term objectives. This is the perspective entrepreneurs take when deciding on the scale of activities, on investment in plant capacity, on hiring and downsizing labour. Entrepreneurs do not think of today or tomorrow. Entrepreneurs think over the medium to long term. This is the perspective that should guide macroeconomic authorities.
In February I suggested that real GDP growth in the Australian economy would be a little over 3 per cent in 2010, and a little higher than that – about 3½ per cent – in 2011 and 2012. It would take only pretty moderate growth in the second half of the year to achieve that forecast for 2010.