3 Others point to an overhang from earlier excessive debt accumulation and suggest that demand is being depressed by a lengthy period of deleveraging. 4 Irrespective of the reasons for the weak demand, several supply-side arguments point to lower rates of growth in the labour force, innovation, and productivity, and consequently investment and output growth.
In my address, however, I will focus solely on the demand side of the economy. While there are many common features to the international picture, there are also notable differences. In advanced economies, investment has generally been weak at a time when the household sector’s consumption-saving balance has not materially altered. 3  A different picture, however, emerges in Australasia.