This paper examines the role of global factors in the Australian economy in the interwar years. In particular, it evaluates the impact of export prices on the Australian rate of inflation, the rate of growth of the economy and the unemployment rate.In the first analysis inflation is decomposed into two sources-one due to the growth of wages and the other due to the growth of non-wage income. The latter depends strongly on the growth in export prices. A macroeonometric model shows that export prices affected economic growth and the unemployment rate which was also negatively related to wages and the tariff rate. The increase in the latter was a poor policy option. It also appears that the Depression was imported into Australia via the fall in export prices rather than the drop in share prices.