bluuebunny/crossref_metadata_2025 huggingface dataset:
Causal Relationships in Australian Wage Inflation and Minimum Award Rates*
Authors: FELS ALLAN , HOA TRAN VAN
Published: October 2007

When variables are correlated in time‐series studies, it is often difficult to determine which is cause and effect, and in what sense. This paper applies multivariate time‐series tests of causality to Australian wage, price, minimum wage award, labour demand and strike (working days lost) variables for 1953‐76. The results provide tentative support for a model in which strikes are exogenous:the size of Arbitration Commission awards is determined by strikes (suggesting that a trade union capture theory of Arbitration Commission regulation may apply):money wages are determined by minimum wage awards; and the demand for labour variable (measured in this paper by the ratio of actual to potential output) is determined (in a negative relationship) by money wages.
Forecasting Australian Marriage Rates*
Authors: McDONALD JOHN , MORGAN PETER
Published: October 2007

The paper discusses the problem of modelling demographic variables for the purpose of forecasting. Two empirical model selection procedures are applied to suggest final form forecasting equations for Australian marriage rates. The suggested models are then assessed by comparing their post‐sample forecast performance with that of univariate ARMA‐type models of marriage rates which are regarded as approximations to marriage rate final equation models. In this instance the ARM A models are preferred for forecasting purposes. The properties of the ARM A model forecasts are then examined and the modelling strategy is contrasted with the regression method used by Withers.
Specification and Estimation of ELES
Authors: COOPER RUSSEL J. , McLAREN KEITH R.
Published: October 2007

The Extended Linear Expenditure System b reformulated to yield private per capita net worth as the basic explanatory variable. As a by‐product the model implies that the marginal propensity to consume/save out of permanent income varies with the rate of interest. In the estimation, account is taken of inconsistencies in data compiled from different sources by explicity including the savings relationship in the system. Parameter estimates based on Australian data are presented.
Estimation of Household Expenditure Functions:An Application of a Class of Heteroscedastic Regression Models*
Authors: BATTESE GEORGE E. , BONYHADY BRUCE P.
Published: October 2007

A class of heteroscedastic regression models is applied to the estimation of household expenditure functions using data from the 1966‐68 Macquarie University survey. Under the assumption that expenditure observations are normally distributed, the hypothesis that their variances are proportional to the squares of their expectations is investigated. In addition, the hypotheses tests derived by Amemiya (1973a) for discriminating between heteroscedastic regression models with gamma or lognormal distributions are applied to the same expenditure data.
Jevons In Australia: A Reassessment*
Authors: WHITE MICHAEL V.
Published: October 2007

Historians of economic thought have generally considered that W. S. Jevons' Australian work on political economy has little significance. This article presents three arguments for reassessing that account. First, while in Australia, Jevons formulated the basic premises of hisTheory of Political Economy.Second, the key influence on him during this period was not D. Lardner, as previously thought, but Professor Maurice Pell of Sydney University. Third, in Australia, Jevons formulated the project which culminated in the publication of his Theory—the derivation of ‘laws’ of income distribution, showing economic agents were rewarded according to their contribution to production.
On the Functional Form of Engel Curves: The Australian Household Expenditure Survey 1975–76*
Authors: BEWLEY R. A.
Published: October 2007

This paper considers the properties of a class of models which is based on the Addilog demand system. These models not only fulfil the adding‐up criterion but also ensure that the predicted expenditures are non‐negative and a subset of these models permits the existence of saturation levels for certain commodities. A goodness of fit comparison between this class and other systems of Engel curves favours the Addilog model. The estimated expenditure elasticities compare favourably with previous estimates of Australian household expenditure patterns and it is observed that the elasticities for health and alcohol and tobacco expenditures have decreased substantially from their levels in the late 1960s.
The Social Marginal Valuation of Income: Australian Estimates from Government Behaviour*
Authors: PIGGOTT JOHN
Published: October 2007

Alternative public policies frequently incorporate distributional goals. The elasticity of the social marginal valuation of income, ε, can help to derive welfare weights for different individuals in different income groups. Estimates are presented of the elasticity of the social marginal valuation of income implied by the Australian personal income tax, in the period 1968–69 to 1975–76. Both equal absolute (EAS) and equal proportional sacrifice (EPS) models are used to infer the elasticity values. Using taxable income as a proxy for income, the consistent value of ε under EAS was found to range from 2.07 to 2.57; the EPS range was 1.76 to 2.40. A number of considerations suggested a best‐guess magnitude of about 2.2. Caution is urged in the interpretation and use of these results.
Economic Growth, Terms of Trade and Welfare in an Open Monetary Economy*
Authors: FUKUSHIMA TAKASHI , PANT MANOJ
Published: October 2007

The authors investigate the impact of growth on terms of trade, absolute prices and welfare using a two‐country, monetary model. Under flexible exchange rates export‐biased growth would lead to a decline in the terms of trade if the two countries are ‘similar’. Under fixed exchange rates a weaker condition than the barter condition of export‐biased growth is sufficient, namely, for the import commodity the demand creating effect of growth dominates the supply effect while for the exported commodity the opposite holds. Secondly, substitutability between money and commodities indicates that no necessary relation holds between the terms of trade and the trade balance. Thirdly, the introduction of money creates a real balance effect so that decline in terms of trade is no longer a necessary (or sufficient) condition for immiserization. Finally, the paper concludes by questioning two policy conclusions drawn in earlier models: one, that the declining terms of trade of less developed countries was due to a bias in the growth strategy and, two, that monetary models of trade support the ‘monetarist’ proposition that growth and a deteriorating trade balance can only co‐exist if the domestic monetary policy is nonneutral.
An Analysis of the Distributional Impact of Imputed Rent Taxation*
Authors: YATES JUDITH
Published: October 2007

This paper examines the short‐run distributional implications of withdrawing the implicit subsidies which accrue to owner‐occupiers through the non‐taxation of their imputed income. It is argued that the distributional implications of taxing imputed income from owner‐occupied housing depend on the interaction of house value, equity and income over the life cycle of the owner‐occupier and that a failure to take all of these factors into account could result in a policy of imputed income taxation having unintended distributional effects within the owner‐occupied sector. The revenue gained from the introduction of such a policy, however, would be more than adequate to offset these effects.
The Marginal Cost of Australian Income Taxation*
Authors: FINDLAY CHRISTOPHER C. , JONES ROBERT L.
Published: October 2007

When the financing of expenditure programmes involves a welfare cost, that cost should be considered part of the opportunity cost of the expenditure programme. In this paper, we explore some concepts of the welfare loss of taxing labour income. We correct some measures previously applied and estimate the marginal cost of Australian public funds. Using our measure of the cost of public funds, we explore the costs of policy options in the motor vehicle industry.
The Effect of Customs Unions Among Specialized Countries on International Capital Flows*
Authors: WEBB MICHAEL A.
Published: October 2007

This paper examines the effect on international capital flows of a customs union formed by specialized countries. We assume no economies of scale, and use a general equilibrium model with internationally mobile capital. It is shown that integration among countries with characteristics generally associated with having specialized economies will lead to a flow of capital into the union. These characteristics specifically concern the types of goods they trade among themselves, and with the rest of the world, and their ability to absorb capital inflows.
A Short‐Run Employment Function for Australia: 1911–12 to 1938–39
Authors: SMYTH DAVID J.
Published: October 2007

This paper develops a short‐run employment function model in which the speed of adjustment is positively related to the level of unemployment. The model is fitted to aggregate Australian data for the period 1911–12 to 1938–39, a period which includes the high unemployment years of the 1930s. Full information maximum‐likelihood estimation procedures are used and a log‐likelihood ratio test indicates that the variable speed of adjustment model is to be preferred to a fixed adjustment speed model. The speed of adjustment was quite sensitive to the unemployment rate. The policy conclusion of the paper is that if Australian unemployment rates rise to levels that are unprecedented in the post‐war period, firms may shake out surplus labour at a surprisingly fast rate.
Cost‐Padding in Profit‐Regulated Firms*
Authors: ALBON ROBERT P. , KIRBY MICHAEL G.
Published: October 2007

When entry into an industry is restricted, economic regulation of that industry is often directed at preventing existing firms from monopoly pricing behaviour. One form of such regulation is to set prices so as to control the level of profits earned by these firms. This paper briefly reviews the relevant economic literature and presents a model of the regulated firm in which such price‐setting procedures provide an incentive to inflate costs above minimum levels. The welfare cost of this form of regulation can then exceed that occurring at the unconstrained monopoly outcome. The setting of air fares under the Two‐Airline Policy and the regulation of natural gas in NSW are discussed in the context of this analysis.
A Cross‐Section Analysis of the Labour Force Participation of Married Women in Australia
Authors: MILLER PAUL W. , VOLKER PAUL A.
Published: October 2007

‘In a time when whales and seals are classified as endangered species, babies also seem to be an endangered species ˙˙˙ with so many mothers in the workforce our population growth has dropped below zero and I think the Federal government should counter that trend˙˙˙˙ Babies born in Australia are our best new Australians.’ (Senator Florence Bjelke‐Petersen in a speech to the Women's Action Alliance, reported in the Canberra Times, 3 June 1981.)

The paper examines the labour supply of married women in Australia using data from the 1974 Census of Population and Housing. A number of approaches to modeling are employed. In the first instance OLS equations are estimated. These estimates are compared with instrumental variable estimates endogenizing wage rates. and with estimates from a three‐equation system endogenizing fertility as well as wages. The evidence suggests that many of the factors proposed by modern theory do exercise significant influences in anticipated directions on the labour supply of married women in Australia.
The Impact of Inflation and Taxation on Tenure Choice and the Redistributive Effects of Home‐Mortgage Interest Rate ReguIation*
Authors: ANSTIE ROSLYN , FINDLAY CHRISTOPHER , HARPER IAN
Published: October 2007

Judy Yates (1981) notes the regressive redistributive impact of home‐mortgage interest rate regulation and offers some explanations. This paper provides an alternative explanation of Yates' observations in terms of the interaction of inflation with the current tax system in Australia. A model of tenure choice in the context of inflation and taxation is developed. In explaining this phenomenon, the model also establishes the regressive nature of the tax subsidy to owner‐occupation. Home‐mortgage interest rate regulation is then introduced. This reinforces the redistributive bias in the housing finance market. The model is used finally to predict the impact of deregulation. It is concluded that deregulation by itself can only remove redistributive bias resulting from regulated mortgage interest rates. Reform of the tax system is required to eliminate the regressive redistributive effects of the tax subsidy to owner‐occupation.
Problems and Prospects for the UK Economy*
Authors: REDDAWAY W. B.
Published: October 2007

Spokesmen for Ms Thatcher's government have repeatedly stated that the British economy was ‘the sick man of Europe’ in the years before 1979; a policy of demand management in pursuit of full employment had brought only temporary relief, whereas her government's firm policy aimed at a long‐term cure. This article considers how far this diagnosis was correct, what the new policies were, how the economy has fared in the light of these policies and the development of North Sea oil and why things turned out that way. It concludes with a brief assessment of future prospects.
The Marginal Cost of Base‐Load Power: An Application to Alcoa's Portland Smelter
Authors: SWAN PETER L.
Published: October 2007

The aim of this paper is to develop and exposit the methodology underlying the computation of the long‐run marginal costs of ‘base‐load’ electricity supply by a publicly owned utility. The particular application is to the costing of power to be supplied by the State Electricity Commission of Victoria (SECV) to Alcoa's aluminum smelter at Portland in Victoria. The results suggest a sizeable subsidy element in the tariff which is sensitive to the selection of the real discount rate appropriate for the public provision of electricity.
Notes and Numbers on Marx's Falling Rate of Profit*
Authors: JÜTTNER D. JOHANNES , MURRAY JOHN H.
Published: October 2007

The purpose of this paper is to estimate and investigate the behaviour of Marx's rate of profit for the period 1919 to 1981. The components of this rate, viz. constant and variable capital which are consistently defined as stock variables, surplus value, organic composition of capital and rate of exploitation, are estimaed for two sub periods for the manufacturing and the corporate enterprises sectors respectively. The rate of profit does not exhibit a discernible trend movement over the period of observation. However, it is subject to pronounced pro‐cyclical variations. A similar picture emerges for the organic composition of capital and the rate of exploitation. The results are critically evalualed.
Prospects for the Australian Economy in 1984*
Authors: PETRIDIS A.
Published: October 2007

Recent economic developments provide the backdrop against which Australia's economic prospects in 1984 are examined. Factors which will contribute to a mild recovery are identified. It is argued that the fiscal stimulus of the 1983 budget could, via the discretionary component, have been even larger without causing a serious monetary or balance of payments problem. This view partly rests on the maintenance of the prices and incomes Accord which, it is suggested, will need to be reinforced by changes to taxation scales in 1984. However, even if employment grows strongly, unemployment will remain at high levels in 1984.
Producer and Consumer Interests, the State‐Owned Pipeline, and Public Authority Pricing of Natural Gas*
Authors: HILLMAN A. L.
Published: October 2007

This paper considers producer and consumer interests when state ownership of a pipeline provides a public authority with monopoly and monopsony power. In contrast with the producer/consumer conflict in the regulatory setting where self‐interested authorities choose the price at which producers and consumers directly transact with one another, in the pipeline case producers and consumers have a commonality of interest which is sustained even if the authorities take the view that it is politically inexpedient to take advantage of monopoly power with respect to consumers.
The Impact of Immigration on a Depressed Labour Market: The South Australian Experience*
Authors: HARRISON DAVID S.
Published: October 2007

This paper examines the impact of immigration on the relatively depressed labour market in South Australia during the 1976‐81 inter‐censal period. The findings indicate that recently arrived immigrants have experienced exceedingly high unemployment rates. However, this is consistent with the view that immigration generates additional job opportunities for Australian residents (except in the manufacturing industry and trades occupations), and that immigrants experience high unemployment rates specifically because they have been unable to compete a ‘fair share’ of jobs away from residents already entrenched in the labour market.
Small Leading Firms*
Authors: FRANCE JEFFREY T. La , SCHMITZ ANDREW , ZILBERMAN DAVID
Published: October 2007

We formally analyze the question of whether a price leader must control a large share of the market. Our main result is that if other producers have rising marginal costs and behave as price takers, even the smallest firm in a competitive industry with a rising supply curve can enhance its profits by cutting output and raising price, becoming a price leader. Therefore, we would expect pure competition to be destroyed under these technological conditions.
Crime, Punishment and Deterrence in Australia: An Empirical Investigation*
Authors: WITHERS GLENN
Published: October 2007

This paper provides empirical estimates of the determinants of crime rates in Australia. It differs from most modern criminological analysis by being aggregative rather than offender‐based and by deriving from the economic approach to criminal behaviour. Its major finding is that court committals and imprisonments have operated as major deterrent factors in explaining variations in recorded crime rates. These deterrence results seem especially strong and robust. Improved measurement, however, could alter the findings for some other influences examined. The paper considers the relationship of these research findings to criminal justice policy.
Bureaucrats and Babies: Government Regulation of the Supply of Genetic Material*
Authors: BUCHANAN CATHY , PRIOR ELIZABETH W.
Published: October 2007

One might object to the sale of genetic material on the ground that it constitutes a trade in human beings. We argue that such exchange does not constitute a morally significant departure from current practice concerning the sale of other bodily property. Some utilitarians have argued that there is no justification for suppliers of genetic material receiving the competitive market‐clearing price for their product. They maintain that utilitarian objectives would be better advanced by distributing genetic material through a government board. We contend that competitive market exchange of genetic material is preferable both because it does more to further individual liberty and because it is more efficient.
The Determinants of Industrial R&D in Australia*
Authors: GANNICOTT K.
Published: October 2007

This paper offers some evidence on the determinants of RAD spending in Australian manufacturing. Two‐stage regressions are employed. Large size has a negative effect on RAD after adjustment for simultaneous equations bias. There is some indication that foreign ownership has a positive effect on RAD in higher technology industries. Tests to examine the role of government subsidy produced only insignificant coefficients.
Contestability and Sustainability in Regional Airline Markets*
Authors: STARKIE DAVID , STARRS MARGARET
Published: October 2007

Since 1979, entry into the varied South Australian air passenger market has been unrestricted. This paper analyzes what has happened during the last four years with particular reference to the theory of contestable markets. Analysis shows that new firms have entered the market, services have increased significantly, new routes have been developed and that there is no apparent difference in the structure of fares on multi‐firm and single‐firm (monopoly) routes.
Interactions Between Government and Private Outlays: Education in Australia, 1949‐50 to 1981‐82*
Authors: WILLIAMS ROSS A.
Published: October 2007

This paper recognizes that government and private final expenditures cannot be modelled in isolation from each other when the expenditure relates to a good such as education which is supplied by both sectors. The inter‐relationships in education expenditure are particularly direct in Australia where the private price of private schooling has been lowered substantially by government grants. Annual data are used to quantify the inter‐relationships.
Structural Balance of Trade Deficits in a Small Open Economy with Exogenous Capital Flows: A Monetary Approach*
Authors: URSPRUNG HEINRICH W.
Published: October 2007

This paper presents a ‘structural’ balance of trade model which can be interpreted as combining two major building blocks. The first one is identical to the monetary approach to the balance of payments. The second, which explains the price level, consists of the orthodox Scandinavian model of price and wage determination. It is shown that under these assumptions the balance of trade deficit can be broken down into a structural, an imported, and a ‘home‐made’ component. A n empirical illustration of the structural balance of trade model is given for the New Zealand economy.
The Micro Effects of Inflation on Corporate Taxation and Profitability: Some Empirical Evidence for Seventeen Industry Groups*
Authors: MATOLCSY Z. P.
Published: October 2007

This study provides some estimates for the following micro effects of inflation: the depreciation effect; the inventory effect; and the net monetary effect. The results indicate that these distributive effects of inflation lead to non‐trivial reallocations of wealth between the different sectors of the economy. Furthermore, the study identifies those industry groups which have benefited from these effects and those industry groups which have ‘lost out’ due to these effects.
The Propagation of Keynesian Thinking in Australia: E. R. Walker 1933‐36*
Authors: CAIN NEVILLE
Published: October 2007

Walker attended Cambridge in the early 1930s when Keynes was moving toward an expenditure‐oriented explanation of output and employment but had yet to break through to his theory of effective demand. In conveying this thinking to an Australian audience through 1933‐35, and in setting up as a Keynesian critic of depression policy, Walker raised the level of local discourse upon the unemployment problem. In 1936, too, he was quick to novelty in the General Theory; but now others were to carry forward the intellectual revolution that was consummated in war and post‐war planning.
Brookings on the Australian Economy*
Authors: HUGHES BARRY
Published: October 2007

This paper offers a review of two central issues of macroeconomic management, nominal wage determination and the relative roles for fiscal expansion and real wage restraint, discussed in the Brookings study of the Australian economy. Consideration is given to the book, The Australian Economy: A View from the North, edited by Richard E. Caves and Lawrence B. Krause, George Allen & Unwin, Sydney 1984, and to the January 1984 conference discussion.
A View from the South on: ‘The Australian Economy: A View from the North’*
Authors: WALSH CLIFF
Published: October 2007

This paper reviews the Brookings Study of the Australian economy reported in Richard E. Caves and Lawrence B. Krause (editors), The Australian Economy: A View from the North, Sydney, George Allen & Unwin, 1984. After some general observations the paper considers each of the chapters in more detail.
An Engel Curve Analysis of Household Expenditure in New Zealand*
Authors: GILES DAVID E. A. , HAMPTON PETER
Published: October 2007

In this paper we estimate systems of Engel curves for expenditure on eight commodity groups by New Zealand households. Six model specifications are considered, and the preferred results are based on the Almost Ideal Demand System. The estimated expenditure elasticities and marginal budget shares are quite insensitive, at the sample mean, to the choice of functional form. The results are compared with those from other Australasian, British and American studies.
Labour Utilization and Wage Inflation in Australia: An Empirical Examination*
Authors: DAWKINS PETER , WOODEN MARK
Published: October 2007

This paper tests the hypothesis that the level of labour utilization within the firm should be substituted into the Phillips Curve in place of traditional measures of excess demand. Gregory and Smith (1983) proposed overtime hours as a proxy for labour utilization within the firm. For various reasons we prefer the deviation from trend in hours worked. The results support the underlying hypothesis, and add strength to the view that to understand the process of wage inflation at the macro level we must examine the utilization of labour at the micro level of the firm.
Indices of the Average Age of Structures and Equipment in Australia 1955/56–1982/83*
Authors: DIXON ROBERT
Published: October 2007

This paper presents an expression for the average age of the capital stock in terms of the rate of depreciation and the rate of accumulation. We derive indices for the average age of private sector structures (excluding dwellings) and equipment in Australia.
Australian Government Policy on Retirement Incomes*
Authors: GRUEN F. H.
Published: October 2007

Australia has evolved an unusual dual system of retirement incomes support. There is a means‐tested flat rate age pension and a system of occupational superannuation receiving considerable tax concessions. The current system gives rise to four major problems. These are enumerated and possible options for reform discussed.
Equilibrium Unemployment in Australia: Concepts and Measurement*
Authors: TRIVEDI P. K. , BAKER G. M.
Published: October 2007

This paper reviews some concepts of equilibrium unemployment and outlines the fundamental difficulties facing any attempt to produce estimates of the equilibrium rate of unemployment. It develops simple quasi‐reduced form models of aggregate unemployment based on rival non market‐clearing and market‐clearing theories. These equations form the basis of an empirical model of aggregate unemployment in Australia since 1969. The empirical evidence suggests that most of the observed increase in unemployment can be attributed to cyclical rather than structural‐frictional factors. However, stylized explanations of cyclical unemployment exclusively along the lines of Keynesian, Classical or equilibrium search theory are found inadequate.
Forward Rates, Interest Rates, and Expectations Under Alternative Exchange Rate Regimes*
Authors: KENEN PETER B.
Published: October 2007

A model comprising spot and forward foreign exchange markets and a domestic credit market is used to examine the trade‐off between volatility in the nominal exchange rate and domestic interest rate. It also shows how a slowly crawling spot rate can raise interest rate volatility and the amplitude of reserve flows. Finally, the paper extends a finding by Driskill and McCafferty that the exchange rate effects of external shocks are differently affected by the responsiveness of speculation to expected profits; high responsiveness makes the spot exchange rate more sensitive to foreign financial shocks but less sensitive to trade balance shocks.
Terms of Trade Indices in the Presence of Re‐Export Trade*
Authors: LLOYD P. J. , SANDILANDS R. J.
Published: October 2007

This paper shows how the index of the commodity terms of trade as ordinarily constructed should be adjusted to take account of re‐exports in the broad sense of the use of intermediate inputs in export activities which had been imported. The neglect of this adjustment produces indices which generally overstate the movement of the terms of trade. An empirical study of Singapore suggests that the bias may be substantial.
A Neo‐Ricardian Trade Model with Overlapping Generations*
Authors: BINH TRAN NAM
Published: October 2007

This paper develops and examines a discrete‐time two‐by‐two‐by‐two barter trading world which incorporates populations. composed of overlapping, life‐cycle‐maximizing generations; each provides an economically distinguishable factor of production. It is shown that free trade without compensation can be Pareto inferior to autarky for one country. Conditions for uncompensated free trade to take place under a majority voting system are derived. The model permits intergenerational borrowing and lending to take place domestically but not internationally.
Affordability and Some Welfare Aspects of Indexation*
Authors: MORGAN P. , McDONALD J. , WOODFIELD A.
Published: October 2007

A general equilibrium model with production and trade is used to analyze whether indexation schemes are affordable.
Fuel Prices, Sales Taxes and Passenger Car Market Shares in New Zealand, 1963–1978*
Authors: FALVEY RODNEY E. , ROGERS ALAN
Published: October 2007

This paper estimates a set of market share equations for new passenger cars in New Zealand over the period 1963 to 1978. These equations are then used to determine the effects on market shares of the fuel price increases and tax rate changes that occurred in the 1970s. The results indicate that the fuel price increases had a major impact on market shares, but that the tax changes probably did not.
Australia and the Pacific Economy*
Authors: DRYSDALE PETER , SMITH BEN , ANDERSON KYM , FINDLAY CHRISTOPHER
Published: October 2007

The industrialization and growth of East Asian countries has shifted the centre of world trade and economic activity towards the Pacific. There has already been a huge redirection of Australia's trade and external economic interests towards the region, based importantly on the emergence of Japan as a major economic power. Australia's future economic prospects will be significantly determined by how it manages its trade policy interests in the context of continuing East Asian industrialization. The most promising Australian trade policy approach is one which allies Australia's trading interests to those of East Asian countries in seeking to maintain an open non‐discriminatory trade regime, supportive of the transformation of trade specialization necessary to the industrialization of resource‐deficient countries, and which marries that objective to the liberalization of her own and Pacific country markets.
Immigrant Unemployment in the First Year of Australian Labour Market Activity*
Authors: MILLER PAUL W.
Published: October 2007

Analysis of data from a 1983 Manpower Programs Survey shows that the relatively high unemployment rates experienced by overseas‐born labour market entrants are reasonably widespread across immigrant groups. One exception is refugees, who are more likely to be unemployed than non‐refugees. Consistent with prior research, additional years of education are associated with only modest reductions in the unemployment rates of immigrants. However, immigrants are able to reduce their predicted unemployment rates considerably by obtaining information on Australian job opportunities prior to migrating.
Economic Aspects of the Foreign Student Question*
Authors: THROSBY CD.
Published: October 2007

Foreign students comprise about 4 per cent of total student enrolments at Australian universities and colleges. The numbers of private overseas students in Australia are regulated by quota and by the imposition of a subsidized fee. Australian government policy towards overseas students has been discussed in two recent government reports which reach conflicting conclusions about desirable policy changes. This paper puts forward the arguments against which the economic aspects of these two reports can be judged, discussing the theoretical basis for regulation by fees and quotas and applying these considerations in the present A ustralian context. It is found that, despite some recent moves in the right direction, Australian policy towards foreign students and towards the use of tertiary education as a medium of foreign aid, is still short of ideal when judged on economic grounds.
Managed Exchange Rates*
Authors: PRACHOWNY MARTIN F. J.
Published: October 2007

Managed exchange rates have become a tool of macroeconomic stabilization policy. Much of the previous emphasis on parametrically chosen exchange rate regimes has missed the advantages of a strategy of a variable target exchange rate when the central bank tries to maintain equilibrium output in the face of various shocks to the economy. Based on a standard IS‐LM‐AS macromodel, optimal combinations of exchange rate and money supply changes are found that insulate the economy against all stipulated shocks. However, these combinations vary from one shock to another; therefore recognition signals are necessary. Continuous information on some variables allows the central bank to identify shocks if they can be guaranteed to occur individually, but not otherwise. As a second‐best strategy, ‘defensively managed exchange rates’ appear suitable. The paper also discusses some side effects and other practical difficulties of a managed exchange rate as an automatic stabilizer.
The Effective Protection Rate Under Uncertainty: A Note*
Authors: ELDOR RAFAEL
Published: October 2007

This note presents a measure of the effective protection rate in a general equilibrium model under uncertainty where a stock market exists and international trade in securities takes place. Real equity prices replace the final commodity prices since, in the presence of uncertainty, resource allocation and therefore the output of each industry is governed by real equity prices. Using expected utility as a welfare criterion, it is shown that second‐best optimum can be achieved by a tariff on the intermediate good at a rate given by setting the new measure to zero. This note provides the theoretical foundations to the measure estimated by Eldor (1984).
Sex Differences in Labour Turnover in the Australian Public Service*
Authors: CHAPMAN BRUCE J. , PRIOR HEATHER
Published: October 2007

This paper reports the use of a large data set of Australian government employees in an analysis of the influence of sex on voluntary labour turnover. Estimates derived from a conventional quit model are used to obtain ceteris paribus sex specific quit probabilities. These suggest that once other relevant variables are held constant, the expected quit differences between men and single women are significantly reduced. The analysis indicates clearly that the use of aggregate statistics may substantially exaggerate turnover differences attributable to sex.
Economic Growth and Income Support Policy in Australia*
Authors: COX J. P.
Published: October 2007

This paper examines the growth in welfare spending in Australia over the 20 years from the early 1960s to the early 1980s. Particularly for pensioners and beneficiaries with children, the levels of benefit and high tax rates implicit in the tax and social security systems are shown to create disincentives over wide ranges of private income. A careful examination of the evidence indicates that more generous levels of benefits had a modest but significant part in the growth of unemployment since 1970. The paper concludes by suggesting that the efficiency costs of meeting society's distributional objectives can be minimized by targeting assistance to the most needy and by the careful use of income testing.
Uncertainty and Production Quotas
Authors: FRASER R. W.
Published: October 2007

This paper examines the role of uncertainty in determining the impact of production quotas on a risk‐neutral producer's behaviour

In the context of production uncertainty the introduction of a quota will lead to a reduction in planned production. Moreover, in a situation of an established quota, the level of planned production relative to the quota depends both on the size of the profit margin on quota production and on the extent of production uncertainty. Apart from these direct influences, uncertainty influences planned production indirectly in a situation where over‐quota production can be sold in an uncertain export market. The direction of this influence depends on the relationship between the producer's uncertainties of price and production. It is argued, therefore, that the welfare assessment of the impact of production quotas must incorporate the role of uncertainty.
The Effect of Equal Pay for Females on the Composition of Employment in Australia*
Authors: BONNELL SHEILA M.
Published: October 2007

Equal pay for female workers in Australia resulted in marked increases in labour costs. These varied across industries. However. changes in the industrial structure induced by equal pay are found to contribute little by way of explanation for the relatively faster growth of female than male employment in the 1970s.
Speculative Efficiency and the Exchange Rate: Some Evidence Since the Float
Authors: TEASE WARREN J.
Published: October 2007

This paper considers whether the speculative efficiency hypothesis holds in the foreign exchange market since the floating of the Australian dollar in December 1983. For the post‐float period as a whole, the speculative efficiency hypothesis can be rejected in the 30‐day market but not in the 15‐day or 90‐day markets. Evidence of a structural change in the market in February 1985—the time of the first major depreciation ‐ was also found.
Non‐Price Barriers to Home Ownership*
Authors: MALE SARAH
Published: October 2007

The impact of regulation of the nominal rate of interest for mortgages in the Australian market for housing finance is examined under inflationary conditions. It is argued that the neglected distributional consequences of the induced tightening of non‐price rationing of funds militate against the availability of housing finance to low income groups and first home buyers. Policy to increase availability should take account of the institutional features of the mortgage contract.
Balancing the Australian National Accounts
Authors: CROSSMAN PETER
Published: October 2007

This paper describes a method of balancing the Income and Expenditure Accounts. By formulating the accounts in a social accounting matrix, assigning reliability weights to the items in the accounts, and using an elegant balancing method advanced by Stone, the discrepancies in the accounts may be removed. Results of this are presented for the period 1970‐71 to 1983–84.
Alternative Schemes for Distributing Transfers to Natural Disaster Victims: Analysis and Implementation*
Authors: BUTLER J.R.G. , DOESSEL D.P.
Published: October 2007

This paper outlines a scheme for distributing natural disaster relief to individuals derived from the principles of equity in taxation. This scheme is then given a specific algebraic formulation which, given a constraint on the total value of grants to be distributed, can be solved subject to grant‐making bodies determining one of two policy parameters, viz, a subsistence income level below which disaster victims would bear no damage themselves, or the rate at which grants are reduced as peoples' incomes increase. The scheme as outlined can be adapted to policy makers' different specifications of one of these two parameters. Empirical implementation of the scheme is illustrated.
Immigrant Wage Adjustment in Australia: Cross Section and Time‐Series Estimates*
Authors: BEGGS JOHN J. , CHAPMAN BRUCE J.
Published: October 2007

Cross‐sectional estimates of the comparative wage performance of natives and immigrants can be distorted if there are changes in labour market quality between immigrant cohorts. This question is investigated with a study of 1973 and 1981 cross‐sections of Australian migrants. We find that migrants from non‐English‐speaking countries entering Australia about 1965 perform significantly better between 1973 and 1981 than predicted from the 1973 cross‐section. Migrants from English‐speaking countries time‐series wage performance is consistent with the 1973 cross‐section prediction. The paper interprets the analytic importance of these results.
Occupational Sex Segregation —Increasing or Decreasing?*
Authors: KARMEL T. , MACLACHLAN M.
Published: October 2007

Contrary to previous findings, the new index of sex segregation derived in this study suggests that sex segregation in the Australian workforce has been increasing. A decomposition of this new index indicates that the main reason for the increase is the increasing share of employment held by females. The decomposition also considers a number of aspects of occupations including growth rates, skill levels and gender domination.
A Note on Aggregate Investment in Australia*
Authors: McKIBBIN WARWICK J. , SIEGLOFF ERIC S.
Published: October 2007

The purpose of this paper is to explore the relevance of Tobin's ‘q theory’ of investment in explaining aggregate investment in Australia, over the period from December 1966 to December 1986. Using standard capital stock data, the q theory performs poorly. However, the cost of adjustment model implies that the conventional capital stock data need to be revised to allow for these adjustment costs. Once this is done, it is found that the q theory explains a statistically significant (although small) proportion of the movements in aggregate investment The residual behaviour of investment is well explained by an accelerator model
The Economic Effects of Public Housing in Australia*
Authors: AGRAWAL NISHA
Published: October 2007

Public housing provides subsidized shelter to approximately 300 000 families in Australia. This paper provides the first estimates of the effects of the program on die consumption pattern of participants, and of the benefits they derive from U. It also examines the distribution of benefits among participants. The effects of the public housing programs are compared with those under an alternative program of equivalent‐value, unrestricted cash grants.
An Econometric Study of the Demand for Bottled, Canned and Bulk Beer*
Authors: PENM JAMMIE H.
Published: October 2007

This paper uses the absolute price version of the differential demand model to examine substitution possibilities for the consumption of beer in different containers in the period 1968–69 to 1983–84. The results indicate that the effect of beer packaging in beer consumption is significant. The same beer in different containers can be treated as quite different products The conditional substitution between bottled beer and canned beer is the highest among the beers. However, due to a strong ‘income effect’, the unconditional substitution between them is lower than that between bottled beer and bulk beer.
Hidden Gaming in Hierarchies: Facts and Models*
Authors: LAFFONT JEAN‐JACQUES
Published: October 2007

We study a three‐level hierarchy in which the role of the supervisor is to transmit to the entrepreneur (the principal) information about workers' individual performances We are concerned with a form of discretion which arises from monitoring personalized incentive schemes through a supervisor, that we call hidden gaming. The supervisor can use his discretionary power to organize games unobserved by the principal which enable him to extract benefits from workers. This extortion activity decreases the level of efficiency of the organization and it is shown to subsist partly even when the principal monitors the supervisor with the best incentive scheme based on his own information. In some circumstances non‐personalized incentive schemes are optimal because of hidden gaming. The paper concludes with a discussion of possible motivations for public intervention within organizations to eliminate extortions due to hidden gaming.
Terms of Trade and Welfare: A General Analysis*
Authors: LAHIRI SAJAL , ONO YOSHIYASU
Published: October 2007

We develop a necessary and a sufficient condition for an improvement in terms of trade to reduce welfare under a general setting, which can accommodate various types of market stucture and trade distortions. We also apply the conditions to two specific cases, viz export subsidies and the existence of monopoly in a non‐tradeable sector. It is found that a rise in price for an exportable commodity which is subsidized may well reduce welfare. Also, improvements in terms of trade may well harm the economy if there is a non‐tradeable monopoly sector.
An Exploration of Rent Seeking*
Authors: BROOKS MICHAEL A. , HEUDRA BEN J.
Published: October 2007

The aim of this paper is 10 survey critically the recent literature on rent seeking and Directly Unproductive Profit‐Seeking Activities (DUP). The links with the related literatures on transactions costs and property rights are also explored. It is argued that a clearer understanding of wasteful competition emerges if the framework of constitutional economics is adopted. It is furthermore argued that a dynamic framework is most suitable to analyze wasteful competition
Employment Implications of Improved Labour Productivity in the Australian Iron and Steel Industry*
Authors: RIMMER RUSSELL
Published: October 2007

The long‐run employment and our put effects of increased productivity in Australian iron und steel industry are investigated. This work suggests that employment in the iron and steel industry will expand und there will be shifts in the occupational composition of employment. These results ure preserved in u sensitivity analysis in which different trade scenarios are assumed und variations in indutry input‐output shares und other key parameters are made.
Dynamic Behaviour of a Unionized Solow‐Swan Economy*
Authors: HAWTREY KIM
Published: October 2007

The impact of union behaviour on the economy has received fresh theoretical attention lately, but virtually all the work to date has been conducted in a comparative static context The research reported in this paper seeks to break new ground in this field by placing the unionized labour market squarely in the framework of a dynamic (Solow‐Swan) growth model The analysis works from first principles, relating the microeconomic decision‐making procedure of an interventionist trade union to the growth of the capital stock, and the intertemporal flavour of the model is enriched by the presence of two‐period‐lived individuals. The precise dynamics of the interaction between union optimization and capital accumulation are unfolded
Prudential Supervision of Australian Banks*
Authors: HOGAN W.P. , SHARPE IAN G.
Published: October 2007

The paper provides a description of the existing legislative basis for prudential supervision in Australia, traces the development of a more formal approach, and critically assesses existing legislation and the bank examination process. Particular emphasis is devoted to the role of external auditors as quasi bank examiners.
Macroeconomic Policy and the Current Account in an Open Economy with Partial Wage Indexation*
Authors: PITCHFORD J. D.
Published: October 2007

In Australia the practice of partially indexing wages has become an art form. While open economy macroeconomics has been extended by various authors to the indexed wage case, none highlights the distinctive effects of partial indexation. This paper examines short‐and long‐run consequences of partial indexation. The standard conclusions that partial indexation is conducive to growth and that fiscal policy with partial indexation is expansionary are seriously questioned
A Tax Package to Reduce the Marginal Rate of Income Tax and the Wage Demands of Trade Unions*
Authors: CREEDY JOHN , MCDONALD IAN M.
Published: October 2007

To reduce the level of tax evasion, a shift of taxation away from income tax and towards a consumption tax has been proposed in Australia. This paper shows that for such a shift to maintain revenue but not induce trade unions to raise their wage demands, it is necessary that the income tax threshold be increased. Numerical examples of desirable tax packages are given.