Australian Economic Review
- Publication date:
- Economic Aspects of Loneliness in Australia
We highlight the problem of loneliness, and argue that it is not only a public health issue but also an economic problem. We provide a brief review of findings from the key literature on the associations between loneliness, mental and physical health, and healthcare costs; and then present some evidence on its trends, the extent of socioeconomic inequalities and its links with health and healthcare usage, in Australia. We hope to encourage further economics research on loneliness, and related issues of social isolation and poor social support, to aid the design of policies and interventions to reduce loneliness.
- Issue Information
- Modelling the Spread of the Coronavirus: A View from Economics
This article reviews the modelling of the spread in Australia of COVID‐19 from the point of view of the discipline of Economics. After a brief overview of the epidemiological approach, we show that other modelling is needed for policy purposes and especially to provide a full understanding of the economic and social costs of disease control. We look at microeconomic aspects of infection, focusing on individual behaviour, the choices facing the individual and implications for policy. The use of a cost–benefit approach and macroeconomic aspects of the pandemic are examined together with the economic consequences of policy response.
- The Value of Pole Position in Formula 1 History
In this article, we study the effect of the Pole Position in Formula 1 history on the outcome of the race. Using data for every race between 1950 and 2013, we use two approaches to quantify the effect of being on Pole. First, we estimate the effect on the probability of winning the race using a logit model. Second, we estimate a Poisson model to express the effect in terms of finishing positions. We find that the Pole sitter does have a significant advantage over the other drivers on the grid: two positions at the finish line or about a 10 percentage point higher probability of winning the race. These estimates capture the effect controlling for various confounding factors and a rich set of fixed effects, including driver ability, track characteristics and constructor performance. We also document that the effect varies over seasons.
- Putting the Australian Economy on the Scales
Based on the increasing size of the service sector, some believe that growth in advanced countries has come without much change in the physical weight of output. To investigate the question, I generate rough estimates of the physical weight of Australian output from 1831 to 2018, using data on the weight of traded goods. These ballpark estimates imply that the weight of annual output increased from around 50,000 tonnes to around 800 million tonnes. Over the long term, a 10 per cent increase in real GDP was associated with a 12 per cent increase in the physical weight of output.
- The Australian Economy in 2020–21: The COVID‐19 Pandemic and Prospects for Economic Recovery
This article summarises developments in the Australian economy in 2020. It describes the economic growth and labour market ramifications associated with COVID‐19, and the fiscal and monetary policies implemented to help counter its effects. COVID‐19 has resulted in considerable slack in an economy that was weak pre‐pandemic. While current policies are appropriately focused on stimulating demand and supporting employment, existing challenges such as weak growth in productivity, gross domestic product and real wages are also likely to remain relevant post‐pandemic.
- The Productivity Commission Inquiry Report into Mental Health—A Commentary from a Health Economics Perspective
The Productivity Commission's Inquiry Report into Mental Health makes extensive recommendations to improve population mental health as a means of further enhancing productivity and economic growth. While providing an invaluable high‐level vision for reforming current mental health and social systems at a programmatic level, it lacks supporting evidence that would guide implementation of specific recommendations. We discuss important methodological considerations used to measure the output of the mental health sector and present clinical and cost‐effectiveness evidence, supporting selected recommendations. We suggest the development of a broad‐based health technology assessment process to facilitate consistent decision making across health and other government sectors.
- Wage Growth Distribution and Changes over Time: 2001–2018
We explore how much wage growth varies among Australian employees and how it has changed over the 2001–2018 period. The results show that, after increasing between 2002 and 2007, wage growth significantly slowed post 2008, and particularly from 2013 onwards, returning to early 2000s levels. Employee age, education, employment contract, occupation and industry explain a large share of differences in wage growth between individuals. Employee occupation is more important post‐2008 than pre‐2008, whereas education is more important pre‐2008. Finally, casual employees receive a wage growth premium during periods of economic upturn and a penalty during downturn.
- Dynamics of Mental Health and Healthcare Use among Children and Young Adults
Despite the high rates of mental disorder in adolescents and young adults, treatment utilisation is low. Using Australian longitudinal administrative and survey data, we show an increasing proportion of young people are accessing nervous system scripts as they age. Younger cohorts have increasingly accessed these scripts earlier; usage is generally higher among disadvantaged groups and in regions with better mental health service access. Less than half of all young adults facing very high psychological distress in 2018 had recently accessed mental health care. Instead of professional help, young people turn to friends and family for help with personal and emotional problems.
- When Does Electricity Price Cap Regulation Become Distortionary?
Australia has a deregulated national wholesale electricity market, a national network regulatory framework, but inconsistent state‐based regulated retail price caps in workably competitive markets. This article finds that asymmetric information and the complexity of energy markets means that a...
- Non‐Standard Employment and Wage Growth in Australia
Using data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey, and after restricting attention to employees, we observe an increase over time in the non‐standard employment share, all of which is concentrated in the period since 2009. Further, we find clear evidence that...
- Service Oligopolies and Australia's Economy‐Wide Performance*
Australia's services industries now contribute almost four‐fifths of gross domestic product. The microeconomic reforms of the 1990s left behind numerous regulated private service oligopolies that contribute one‐quarter. Using an economy‐wide modelling approach that represents service oligopoly...
- A Survey of the Privatisation of Government‐Owned Enterprises in Australia since the 1980s
In this article, a survey is provided of the privatisation of government‐owned enterprises in Australia since the 1980s. In particular, the article evaluates the evidence that has been compiled on the success or failure of privatisation in enhancing efficiency in various industry sectors. In terms...
- Is Trade Liberalisation Pro‐Poor in Pakistan? Evidence from Large‐Scale Manufacturing
This article aims to analyse the impact of industry‐level trade liberalisation (measured through industry‐specific tariff rates) on poverty in Pakistan. Combining data for tariff rates with the Labour Force Survey of Pakistan, we use quantile regression analysis to estimate the impact of changes in ...
- Challenges Facing the World Trade Organization: An Overview
Tensions are running high in the world trading system. Sufficient conditions now exist for a continuing degeneration of trading relations creating a downward spiral and launching a serious trade war with unknown consequences. History has shown this scenario can be avoided if trading relations are...
- Towards Understanding Macrofinancial Impacts of Loan‐to‐Value Ratio Policy in New Zealand: A General Equilibrium Perspective
We use a dynamic stochastic general equilibrium model as a framework for thinking about the transmission mechanism of loan‐to‐value macroprudential policy. We analyse the key channels through which the caps on loan‐to‐value ratios work to limit the speed of asset and credit cycles. We further...
- Impact of Immigrant Peers on Native Students’ Achievement: Evidence from Australia, Canada and the United States
This article examines how exposure to immigrant students affects the achievement of native students in Australia, Canada and the United States. Variation in the share of immigrant students across different grade levels within schools is exploited to identify the impact of immigrant peers. The study ...
- The Consequences of Retail Electricity Price Rises: Rethinking Customer Hardship
The Australian energy sector is nearing the end of an investment megacycle, which has driven above‐trend electricity tariff increases. In this article, we combine energy market and demographic data and find that the dominant thought on customer hardship, aged pensioners, pales into insignificance...
- Birds of a Feather Flock Together: Correlation in BMI Categories in Long‐Term Relationships
This is the first article to explore partner correlations across Body Mass Index (BMI) categories for couples in long‐term, stable relationships using data from the Household, Income and Labour Dynamics in Australia Survey 2006–2011. The moderating effects of three hypotheses on this correlation...