The Growth of Urban Areas in Australia

This paper analyses the main causes of the growth in population and employment in urban areas in Australia. We find that two-thirds of the variations in growth rates between 1981 and 1991 are explained by four factors: an inland location, a reliance on primary sector production, a tourist orientation, and suburban growth. Tourism and suburban growth greatly increased both population and employment growth. Inland towns and coastal commodity towns experienced well below average growth. Similar results are found for the five years from 1976 to 1981. Consistent with earlier Australian research, we find that urban growth in the 1980s was negatively correlated with government employment in the cities in 1981. But, unlike this previous research, we find that there is no general relationship between urban growth and the initial population level, the initial human capital or the level of economic specialisation of an urban area. Journal of Economic Literature Classification numbers: 018, 047 and R11. * We wish to thank Professor Joshua Gans for generously providing us with his urban area data and for comments on this paper in draft. We are also grateful to Richard Cardew for detailed advice about the nature of the urban areas under investigation and to Roselyne Joyeux for statistical advice. The authors are solely responsible for the views expressed and any errors or omissions in the paper.