Pricing the Luck: A Worked Macroeconomic Profit-Efficiency Calculation of the Australian Economy, 1965–2024

This working paper provides a whole-of-economy application of the Macroeconomic Profit Efficiency Index (MPEI) to Australia from 1964–65 to 2023–24. It is a non-peer-reviewed companion use-case paper prepared to support the Macroeconomic Profit Efficiency Index framework and its associated reproducibility materials. MPEI is a diagnostic ratio that asks how much retained community value an economy generates per unit of profit impost. In this application, National Retained Value (NRV) is constructed as gross value added plus non-market value, less bio-physical liquidation and net external transfer. The Profit Impost (PI) is decomposed into productive profit and systemic rent, with a participation-floor coefficient applied to test whether retained value is broadly accessible across the community. The paper’s principal methodological contribution is the translation of MPEI from a sectoral setting to a national accounting boundary. It develops state-capture screening rules for imputed owner-occupier rent, government-owned corporation surpluses, resource royalties and the petroleum resource rent tax, and treats public-service non-market value as a welfare increment above accounting cost to avoid double-counting. The contemporary central-case Australian MPEI is approximately 4.4, with a sensitivity range of 2.96–6.17. The calculation reflects National Retained Value of approximately A\\$3.49 trillion, a screened profit impost of A\\$694 billion and a participation-floor coefficient of approximately 0.87. The paper reports a conservative benchmark pair: MPEI*min of approximately 5.78 and MPEI*opt of approximately 9.25, implying attainment of approximately 75.7 per cent of the provable benchmark and 47.3 per cent of the estimated benchmark. The historical trajectory is the substantive finding. Australian MPEI rises from approximately 7.9 in 1964–65 to a peak of approximately 9.5 in 1974–75, then declines by 54 per cent across the subsequent five decades. Unlike the companion US healthcare case, the Australian decline is not primarily a participation-floor collapse: the participation floor remains comparatively high and stable. The decline is instead interpreted as an impost, transfer and liquidation story, driven by the rising screened profit-impost share of GDP, a persistent external income deficit and unconverted bio-physical liquidation associated with the resource boom. The paper also situates Australia within a four-country comparator panel comprising Norway, the Netherlands, the United States and Equatorial Guinea. The comparator analysis positions Australia on a resource-curse gradient between Norwegian stewardship and Equatorial Guinea’s terminal resource-curse configuration, with the United States and Netherlands treated as externally oriented predator-steward comparators. The accompanying reproducibility package provides the input files, scripts, assumptions register, attribution tracker, figure-generation files and calculation outputs used to reproduce the reported results: https://doi.org/10.5281/zenodo.22668558