As the economy becomes more complex and varied, correlation between sectors diminishes: the tourism sector may be doing well when house construction is slow; • perhaps the most important on-going change to the cycle is the continuing integration of Australia with the international economy. Thirty years ago, 10 per cent of (real) GDP was exported; now it is almost 25 per cent.
And when new forces have arisen with the potential to undermine openness – the threat of competitive devaluations or of financial spillovers – Europe has not responded by raising barriers. Rather it has sought – and is seeking – to fill the gaps in its economic and monetary union with institutional innovations like the banking union.