National Economic Panel



ESA National Economic Panel Polls





Got an Idea?

Author's Name: Paul Frijters
Date: Tue 12 Feb 2019

Paul Frijters

Professor Paul Fritjers

Paul Frijters completed his Masters in Econometrics at the University of Groningen, including a seven-month stay in Durban, South Africa before completing a PhD at the University of Amsterdam into wellbeing in Russia during the transition. He is currently a Professor in Wellbeing Economics at the LSE, teaching the Masters Course in Wellbeing and Public Policy. Professor Frijters specializes in applied micro-econometrics, including labor, happiness, and health economics, though he has also worked on pure theoretical topics in macro and micro fields.

Paul currently advises the UK government and others on how to implement wellbeing policies at the national and regional level.

Before joining the LSE, he was the Research Director of the Rumici Project, an international project into the migration from the countryside to the cities in China and Indonesia, sponsored by ministries, the World Bank, the Ford Foundation, and many others, tracking 20,000 individuals for many years. In 2009 he was voted Australia's best young economist under 40 by the Australian Economic Society.

Paul publishes regularly in top 50 economics journals (AER, EJ, JHR, HE, JHE, JEBO), as well as inter-disciplinary outlets and Handbooks. He has (co-)authored around 150 papers, 6 books and is in the top 1% of cited economists.

Paul is interested in all aspects of social science, but particularly wellbeing and public policy. He has in the past worked as a health economist, a labour economist, a specialist on the economics of China, and an econometrician. He does lab experiments, field experiments, big data analyses, simulation modelling, macro-modelling, econometric theory, and field work.

Subject Area Expertise

Econometrics, labour, health, happiness, macro, development, political economy, rent-seeking, IO.



Responses (7)

October Budget 2020 - preferred four programs

Poll 42 

"The October budget will see the government announce additional policies to support recovery.  Please nominate the four programs you think would be the most effective (for an intervention of a given size) over the next two years"

Photo Credit: Wes Mountain/The Conversation, CC BY-ND 


One-off cash transfers to households, Social housing

For the government to build affordable social housing is a good policy at almost any time, but particularly now with high unemployment. One-off transfers help reduce inequality and are a form of welfare increase, which is not too bad at this time. All the other 10 are either counter-productive because they simply mean more problems down the line, or they happen to be useless at this point in time. By far the best thing to do is to lift lock downs, travel restrictions, and social distancing rules, which do much more damage than any measure can repair. There is little point at providing band-aids whilst continuing to saw off the leg.

The legislated increases in compulsory super contributions should...

Poll 41

"The legislated increases in compulsory super contributions, which are set to climb from 9.5% of wages to 12% over the next five years should...."

Photo Credit: Wes Mountain/The Conversation, CC BY-ND 




I regard Cameron Murray as one of the main experts on this now. Several public sector and private sector reports over the last 10 years, as well as our joint work in the booklet "Game of Mates" showed that compulsory super is largely a scam. The overhead is so large as to easily take 30-50% off people's super, straight into the pockets of the union bosses and employers running the schemes as directors of these compulsory funds. The main way it works is that the union bosses and big employers coordinate on the funds they "allow" their workers to choose from, as well as the particular defaults and charges in those funds, herding the workers into the fleecing stations. Expansion of the compulsory super element is thus a straightforward grab by corrupted groups for an even bigger slice of the wages of the population. Their running excuse is bogus, which is that people cannot look after themselves or that the scheme could not be run much cheaper. Both are simply untrue.

Policies to deliver higher wage growth

Poll 48

Our panellists were asked

"Higher wages growth is now a top priority of the RBA in its efforts to sustain stronger economic growth. Please identify the three of these government policies you think would best help deliver higher wages growth".  

Photo credit "Wes Mountain/The Conversation, CC BY-ND"



Measures to boost productivity growth;Reforming industrial relations to boost the bargaining power o

In the long-run, what matters is productivity and the bargaining power of labour. Governments can improve productivity by reforming the education system so as to provide high-level education. This would require major reforms, though it would not require money. Bargaining power of labour can also be increased such as by making it easier for labour to organise in more effective trade unions, and via increased minimum wages. All the other measures mentioned reduce real wages in the longer run. Restricting migration is clearly bad for long-run wage growth because foreign migrants have complementary skills to those educated in Australia, so restricting their inflow reduces the productivity of those living here. Lowering taxes means lowering government expenditure on productivity-improving investments. 'Boost business investment' is an empty gimmick phrase. Etc. So I see only two measures that governments can actually take that would increase real wages in the longer-run: the bargaining power of unions and productivity improvements. The other ones are either not up to government, do not work, or have opposite effects.

Government Debt during the COVID19 Crisis

Poll 40

"Governments should provide ongoing fiscal support to boost aggregate demand during the economic crisis and recovery, even if it means a substantial increase in public debt"

Photo Credit: Wes Mountain/The Conversation, CC BY-ND 




In a normal depression, I'd say "of course" because when hit by an outside economic shock, you want to stimulate aggregate demand in order to minimise unemployment whilst businesses adapt to the changed environment.

Transition to electric cars

Poll 47

This month, our panellists were asked whether Australia should take action to speed the transition to electric cars.

"As part of efforts to reduce carbon emissions, Australian governments should take action to accelerate the take up, or take no action to accelerate the take up of electric cars"

Photo credit "Wes Mountain/The Conversation, CC BY-ND"




This is an opportunity to tax. So one should tax luxury cars, electric cars, charging points, the lot. The idea that one should subsidise everything is a version of 'free money'.

The Federal Budget May 2021

Poll 46

"On May 11, the government delivered a budget designed, in the Treasurer's words, to 'secure Australia's economic recovery and build for the future'.  What grade would you give the budget given that objective, A, B, C, D, E, F?"

Photo credit Wes Mountain/The Conversation, CC BY-ND




I pity the treasury economists that had to come up with this one. They have been forced to pretend there is an unlimited amount of money to spend with no need to worry about debt, investments in education, or tax evasion. I particularly had to laugh about the plans to attract skilled migrants and students to Australia whilst it has turned itself into a prison camp that does not allow visits to family overseas. Good luck with that. It seems the treasury is being forced to make the best of an unsustainable situation in the hope the public comes to its senses on corona. The only saving grace has been the huge increase in iron ore prices that has rescued the balance of payments. Talk about 'lucky'!

Does the budget rebuild our economy and create jobs?

Poll 43

"On 6 October, the Government delivered a budget designed, in the Treasurer's words, to 'rebuild our economy and create jobs'.  What grade would you give the budget given the objective?  A, B, C, D, E, F"

Photo Credit: Wes Mountain/The Conversation, CC BY-ND 



The Treasury didn't do the one thing recommended by most economists, which is to start a social housing program to make housing affordable and create jobs. Instead, it basically gave out lots of money to the rich that it didnt have. So debt will sky-rocket with few jobs created since the continued covid-related restrictions mean production and commerce remain repressed. The budget is hence like pushing the gas pedal and the brake at the same time, which just means loss of fuel and spent breaks. There was also no long-run orientation in this budget. No plans to overhaul the tax system to ensure a return to surplus and no plans to improve education and training. It was just about boosting demand and pleasing supporters. A waste.