ABSTRACT
Production of gold in Australia has grown strongly in recent years. Australia is ranked the world’s third largest gold producer, only South Africa and the USA producing more. Most of the Australian gold production comes from one state, Western Australia. In this chapter, we use recent developments in econometric time-series analysis to present an analysis of gold production and prices during the period 1948-94. The results show that, if the price of gold (relative to costs) increases by 10 per cent and the price (in levels) remains the same for the next 5 years, then in the fi rst year gold production will rise by 0.3 per cent; in the second year by 2.2 per cent; in the third year by 7.4 per cent; in the fourth year by 8.9 per cent; and in the fi fth year by 10.7 per cent. We also use Efron’s bootstrap technique to forecast gold production and obtain its standard errors.
