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Under these assumptions the overall reduction in margins on inputs to industries is about $1.85 billion, appro ximately five per cent of wholesale and retail margins on inputs to current production and capital creation. This saving of margins in business is a GDP gain of about 0.37 per cent. (s5) Saving of labour by industries in buying inputs E-commerce will reduce shopping time not only for consumers but also for firms. This is simulated as a labour-saving technical change worth half the savings of margins by industries, that is half of shock (s4). (s6) Purchases of e-commerce equipment by industries As with consumers, it is assumed that industries must buy e-commerce equipment and services worth 25 per cent of their margins savings. By the tenth year this is an annual cost to the economy of about 0.093 per cent of GDP. (s7) Direct labour saving technical progress in transport and banking Some sectors were viewed as having additional productivity gain potential from greater use of e-commerce. Reflecting this view it is assumed that over the next ten years e-commerce will reduce labour costs by five per cent in the Transport and Banking sectors (comprised of MONASH industries 93, 96, 97, 99 and 100). These cost savings will arise from reductions in staff required to provide services to the public (e.g. selling airline tickets). (s8) Time saving by industries dealing with the transport and banking sectors The technical progress gains quantified in (s7) can also be expected to stimulate cost reductions for banking and transport customers. This is calculated in proportion to the use made of those sectors’ inputs. Where j is any industry except Ownership of dwellings (MONASH industry 104), then if industry j uses ten per cent of the services sold by the Banking sector (MONASH industries 99 and 100) then it is assumed that industry j makes labour savings worth half of ten per cent of the savings made by Banking. A similar treatment is adopted with respect to industry purchases of services from the Transport sector (industries 93, 96 and 97). (s9) Time saving by households dealing with transport and banking If households use ten per cent of the services sold by industry q (q= 93, 96, 97, 99 and 100) then it is assumed that households save time worth half of ten per cent of the direct savings made by industry q. It is also assumed that if Ownership of dwellings uses ten per cent of the services sold by industry q (q= 93, 96, 97, 99 and 100) then households receive a time saving worth half of ten per cent of the savings made by industry q. It is assumed that half of the timesaving made by households is devoted to labour and half is devoted to leisure. (s10) Additional margins savings by communications industry As well as the margin savings outlined in (s4), it is assumed that the Communication industry will save an additional 20 per cent of the wholesale margins on all its purchases. Industry representatives indicated that they consider that e-commerce will be important in enabling the industry to buy more directly from producers. 48
(s11) Saving of particular inputs It is expected that some sectors will be able to save inputs through reengineering using e-commerce techniques and other factors. • The Banking sector (industries 99 and 100) is expected to be able to save 5 per cent of its inputs of paper products (commodities 49 and 50). • Business services (industry 103) will save 5 per cent of its inputs of paper (commodities 49 and 50), machinery and equipment (commodities 74 to 80) and financial and business services (commodities 101 to 105). • Because e-commerce will reduce the need for constructing branch offices, it is assumed that the Banking industry (99) will save three per cent of the costs of construction inputs to capital creation. (s12) Twist in favour of imports E-commerce will increase awareness by Australian households and industries of foreign products. This is represented by a twist in preferences which at given prices increases the ratio of imports to purchases of domestic products by five per cent. (s13) Increase in foreign awareness of Australian products E-commerce will increase foreign awareness of many of Australia’s manufactured commodities and of tourism opportunities in Australia. This is represented as follows: • for MONASH commodities 25 to 48, 53 to 57, 59 to 85 and 101 to 105, a vertical upward movement in foreign demand curves of five per cent is assumed; • for commodities 49 and 50 (publishing and printing), an upward movement of ten per cent is assumed; • for tourism, an upward movement of five per cent is assumed. It is also assumed that e-commerce will not increase foreign awareness of Australia’s agricultural, mineral and standard processed food products. These shifts in export demand curves have an impact on the terms of trade of 2.4 per cent. With exports representing about 20 per cent of GDP, this terms of trade improvement is equivalent to a gift to consumers worth about 0.60 per cent of consumption. (s14) Reductions in foreign-currency c.i.f. prices of imports Wider use of e-commerce in Australia will help Australian consumers shop around and get a better deal on imported products. This is recognised in the simulation by assuming for most commodities that Australian consumers will be able to save foreign margins worth 50 per cent of the margins that they save in Australia. For example, if it is assumed that saving of Australian margins reduces the price of clothing in Australia by one per cent, then it follows that shopping around using e-commerce reduces c.i.f prices of imported clothes by 0.5 per cent. It is viewed that some goods are particularly susceptible to such shopping around including books and commercial printing (commodities 49 and 50). For these it is assumed that the percentage reductions in foreign prices equal the percentage reductions in Australian prices caused by saving of Australian margins. 49
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© Commonwealth of Australia 2000 I
Page 5 and 6:
Table of contents Foreword ........
Page 7 and 8:
Part 2 - Case studies Section One I
Page 9 and 10: Executive summary E-commerce is sti
Page 11 and 12: Part 1— economic analysis
Page 13 and 14: Chapter One Study context, aims and
Page 15 and 16: Within the business-to-business cat
Page 17 and 18: Table 1.4 Projected growth in econo
Page 19 and 20: Chapter Two Economic issues What di
Page 21 and 22: Exhibit 2.1 Disintermediation effec
Page 23 and 24: Table 2.1 E-commerce impact on vari
Page 25 and 26: Chapter Three Changes ahead—indus
Page 27 and 28: Health Significant efficiencies sta
Page 29 and 30: Chapter Four Economy-wide assessmen
Page 31 and 32: Direct changes and flow on impacts
Page 33 and 34: consumption relative to economic ac
Page 35 and 36: External competitiveness Greater us
Page 37 and 38: Industry outcomes Greater use of e-
Page 39 and 40: Food products The food products sec
Page 41 and 42: people with differing occupational
Page 43 and 44: Tasmania and the Northern Territory
Page 45 and 46: Table 4.2 Regional growth and emplo
Page 47: The data for country regions (Exhib
Page 50 and 51: impacts are a reasonable representa
Page 53 and 54: Chapter Six Policy implications and
Page 55 and 56: Appendix A Study methodology, shock
Page 57 and 58: confidence. This is at the expense
Page 59: All of the GDP gain generated by ch
Page 63 and 64: Table A.1 continued Commodity Per c
Page 65 and 66: Table A.2 continued Engine & Boiler
Page 67 and 68: Table A.2 continued Safety Inspecto
Page 69 and 70: Table A.3 continued Industries 2007
Page 71 and 72: B.2 The structure of MONASH The cor
Page 73 and 74: simulations it is assumed that the
Page 75 and 76: Table B.1 (Continued) MONASH-RR Reg
Page 77 and 78: C.2 Forecasts for macroeconomic var
Page 79 and 80: other grains, iron and non-iron ore
Page 81 and 82: The numbers in column (II) of Table
Page 83 and 84: Productivity growth over the histor
Page 85 and 86: forecast of a 0.1 per cent decline
Page 87 and 88: Productivity growth in the construc
Page 89 and 90: Employment prospects in the sector
Page 91 and 92: Table D.1 continued Textiles, cloth
Page 93 and 94: Table D.1 continued Health, educati
Page 95 and 96: Table D.2 continued 45 Bags and Con
Page 97: Part 2 — case studies
Page 100 and 101: Industry sectors’ use of e-commer
Page 102 and 103: e-commerce were chosen. Key questio
Page 104 and 105: Banking For some time now most of t
Page 106 and 107: 2.3 Cost savings Banks are keen to
Page 108 and 109: 2.5 Changing business modes Branch
Page 110 and 111:
Banks are also looking to take adva
Page 112 and 113:
NAB, as a multinational, is already
Page 114 and 115:
activities such as consumer electro
Page 116 and 117:
Box 3.2 Building a business on e-co
Page 118 and 119:
One of the issues for all industrie
Page 120 and 121:
108
Page 122 and 123:
Box 4.2 Australia Post and e-commer
Page 124 and 125:
Opportunities are being created for
Page 126 and 127:
Value can be transferred into Austr
Page 128 and 129:
Continued use of email and the deve
Page 130 and 131:
E-commerce allows some flexibility
Page 132 and 133:
120
Page 134 and 135:
are introduced to market at a start
Page 136 and 137:
educe the duplication of assessment
Page 138 and 139:
6.3 Cost savings as a result of ele
Page 140 and 141:
The primary e-commerce tools for im
Page 142 and 143:
New service modes and channels to t
Page 144 and 145:
132
Page 146 and 147:
This Section will review the implic
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of greater depth. (It should be not
Page 150 and 151:
consumers watch five per cent less
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artist is the promotion which airpl
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New costs The fragmentation and reg
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gambled. The development of Interne
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146
Page 160 and 161:
Making a purchase over the Internet
Page 162 and 163:
Customers who access troubleshootin
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they does not actually sell those i
Page 166 and 167:
Key points There are few other sect
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e-commerce allows quicker order pro
Page 170 and 171:
9.3 New costs The demand for busine
Page 172 and 173:
How a ticket is sold, through an ag
Page 174 and 175:
Box 10.1 Case study: E-commerce and
Page 176 and 177:
The education and training sector h
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166
Page 180 and 181:
11.2 Production Manufacturing busin
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Opportunities for re-intermediation
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Value could transfer within the sec
Page 186 and 187:
174
Page 188 and 189:
years’ time. 30 This reflects an
Page 190 and 191:
seeks to provide a point of referen
Page 192 and 193:
To a small extent, direct selling t
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182
Page 196 and 197:
Box 13.1 Austmine—a window for th
Page 198 and 199:
Box 13.2 Leaving mining sites for w
Page 200:
188
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