National Economic Panel

 


 

ESA National Economic Panel Polls


 

About

Polls

Panellists

Got an Idea?

Author's Name: Geoffrey Kingston
Date: Tue 12 Feb 2019

Geoff Kingston

Professor Geoff Kingston

Geoff Kingston obtained his Bachelor and PhD degrees from the Australian National University. He works at Macquarie University. He has published in the Quarterly Journal of Economics, the Economic Journal, The Journal of International Economics, the International Economic Review, the Journal of Money, Credit and Banking, the Journal of Monetary Economics, the Journal of Public Economics and the Journal of Economic Dynamics and Control, among others. His co-authored book on superannuation was published in 2001 by Cambridge University Press. His industry experience includes expert evidence in court cases arising from foreign currency loans, and expert evidence to the inquiry into the fund established by James Hardie on behalf of former employees suffering from the ill-effects of asbestos exposure.

Subject Area Expertise

Macroeconomics, personal finance (superannuation), and international finance.

Website

http://www.businessandeconomics.mq.edu.au/contact_the_faculty/all_fbe_staff/Geoff_Kingston

 


Responses (53)


Top Economists see no prolonged high inflation, no rate hike next year (Q4)

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 4

"Following the next Federal election, the incoming Federal Government should commission an independent Review of the Reserve Bank of Australia."

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

 

Uncertain


Top Economists see no prolonged high inflation, no rate hike next year (Q3)

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 3 

"The Reserve Bank has, over the past 5 years, effectively used the tools available to it to achieve its goals of "maintaining the stability of the currency, ensuring full employment and furthering the 'economic prosperity and welfare of the people of Australia'."

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

 

Agree

7


Top Economists see no prolonged high inflation, no rate hike next year (Q2)

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 2

"When do you expect the Reserve Bank of Australia to next lift its cash rate?"

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

 

.

6

2023


Top Economists see no prolonged high inflation, no rate hike next year (Q1)

Poll 51

Our panellists were asked whether rate hikes would be necessitated in the United States, Britain and Australia.

Despite appearances – especially in the United States – the era of high inflation isn’t set for a comeback in the view of Australia’s leading economists, and most see no need for the Reserve Bank to lift interest rates next year.

Question 1

"The current combination of Australian fiscal and monetary policy poses a serious risk of prolonged above-target inflation."

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

 

Agree

6

The Bank has done a decent job over the last five years. Some critics have over egged their case. True, pre-cCOVID inflation came in below the target range, but so did inflation in the major Western countries. We needed to follow suit to prevent an excessive pre-covid depreciation of the AUD. ?Stability of the currency? has an external dimension, and the Bank has recognised this. A valid criticism of the Bank is that it needs a 1-3 percent inflation target range rather than the current 2-3 percent.


Australia’s top economists back carbon price, say benefits of net-zero outweigh cost

Poll 50

Ahead of November’s Glasgow climate talks, our panellists were asked

"Australia would likely benefit overall from the national economy transitioning to net-zero emissions by 2050"

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

 

An economy-wide carbon price (either via a cap-and-trade scheme or an emissions tax)

Uncertain

Ideally we would have more solid evidence and analysis to the questions of how much carbon dioxide emissions contributed to global warming over the last century, and where the climate would be headed with and without net zero by 2050. But overwhelming offshore pressures, eg damaging trade barriers, may well force us to commit to net zero before these questions have answers. Alas, we have ruled out nuclear energy, thereby over-constraining the problem of ensuring reliable and affordable power. We should avoid free-riding on benefits that may be conferred on us by others that go to net zero. On the other hand, we could end up making the sacrifices entailed by going to net zero in a world where various countries emit much more carbon dioxide than us while giving little more than lip service to that objective.


Promoting vaccination uptake in Australia

Poll 49

"What measures should Australian governments adopt to promote demand for vaccination once supply is no longer a constraint?"

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

 

National advertising campaigns;Mandatory vaccination for higher risk occupations;Vaccine passports for higher-risk settings (eg. flights, restaurants, major events)

We certainly need stronger incentives for people to get vaccinated, Are seeing successful implementation of vaccine passports in various Northern Hemisphere locations. QR coding needs to be a feature. Am not sure about cash incentives but am not opposed either.


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"

 

.

Restraining growth in labour supply by cutting temporary migration (including international students

The history of real average weekly earnings over the last four decades sheds light on this question. The Hawke era (1983-90) saw a big rise in migration to Australia (discussions of the Hawke era tend to neglect this policy shift while overestimating the influence of the Accords on wages). Accordingly, growth in the capital-labour ratio was sluggish and real wages fell for five years in a row: high immigration put downward pressure on real wages. Then came Paul Keating, who cut the company tax rate from 49 percent to 33 per cent. The Keating-Howard-Rudd-Gillard era saw decent growth in the capital-labour ratio, along with two decades of rising terms of trade, which boosted the average value of the marginal revenue product of labour in the economy. Real wage growth was decent too. Finally, the Abbott-Turnbull-Morrison era (2013-2021) saw sluggish investment and ushered in another episode of sluggish growth in both the capital-labour ratio and real wages. We can't do much about our terms of trade but we can cut both immigration and company tax. Immigration has been high recently (at least before the virus) and our current tax rate of 30 percent for large companies has become increasingly uncompetitive by world standards.


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"

 

.

8

Is it heresy to suggest that the proposed action be accompanied by a cost-benefit analysis? Various interventions have already encumbered the supply side of the power industry. The proposed action would boost demand. Do we really want a pincer movement that would further degrade the affordability and reliability of power?


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

 

.

B

This budget exudes optimism. It assumes rapid recovery of tax revenues, a fast vaccine rollout, no third waves of the virus, no spikes in the cost of servicing the debt, and limited threats to national security. Under these assumptions, net national public debt would max out at 41% of GDP in 2025-6. That would indeed be a decent outcome. Fingers crossed. I would have preferred a budget that put more weight on the possibility of less benign outcomes. This would entail spending less on new social programs and more on securing the Pfizer and Moderna vaccines, along with federal facilities for safe quarantine. Likewise, the budgeted increase in defence spending, at 4.1 per cent in 2021-22, is small, given that it is coming off a low base.


Top economists want JobSeeker boosted by $100+ per week and tied to wages

Poll 44

"Ahead of a decision about any permanent increase expected early next year, The Conversation and the Economic Society of Australia asked 45 of Australia’s leading economists where they thought JobSeeker should settle."

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

 

Be indexed half way between CPI and wage growth

I think the government's proposed glide path for JobSeeker is about right. So far as indexation is concerned, we should adopt the Swiss indexation formula of half the rise in wages plus half the rise in prices. This should apply to both unemployment benefits and government pensions. In the short run this method would not make much difference. In the long run it would ensure that unemployment benefits do not drift down relative to pension benefits. All recipients of government benefits would participate substantially but not fully in real wage rises.


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 

 

B

The budget was pretty good, including for jobs and growth. It raises outlays while generally seeking to avoid permanent spending rises. Likewise, there were not big, permanent changes in the tax scales. Accordingly, the budget did not trigger warnings of credit downgrades by the major ratings agencies. The budget plans fiscal deficits to the extent that federal net public debt will max out at 43.8% of GDP in mid 2024. Our all-time record for net public debt seems to have been set back in 1945, when it hit 125%. The plan for a ratio of 43.8% strikes me as judicious, given that we need to retain some fiscal space for contingencies such as third waves, spikes in interest rates and heightened geopolitical tensions to our north. Also, the fact that the household saving ratio stands at 20% indicates that growth in tax revenues may be even weaker over the next few years than what the budget suggests. This is a further reason for not maxing out the national credit card at this time, even as we do add substantially to it.


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 

 

Bring forward legislated personal income tax cuts, Corporate tax cuts, Expanded investment allowance, Funding higher quality aged care

I ticked all the tax-cut options because these would help build up the supply side of the economy. For example, business investment has languished for years. By contrast, options such as infrastructure projects would theoretically build up the supply side yet tend in practice to get diverted by the politicians into comparatively unproductive projects such as inland rail and Snowy 2.0. I ticked the aged-care option because nursing homes need more resources for things such as ensuring minimum ratios of qualified staff to residents and enabling staff to make a decent living without working in multiple facilities. US research has identified working in multiple facilities as a major spreader of the virus. More generally, the public spending choices of the federal government during the next two years need to prioritize the avoidance of second and third waves. For example, Canberra will need to avoid Victoria's mistake of prioritising general pay rises for public servants over providing adequate resources for tracing. Not only is there the public health issue, but funding adequate tracing is as good an option as any for "supporting economic activity for an intervention of a given size."


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 

 

Be deferred

7

Easier access to super was allowed earlier this year. On that occasion Michael Rice, the distinguished actuary, made the point that super needed to play some part in helping us cope with the economic consequences of the virus. The same holds true for the legislated increase in the compulsory contribution rate. There needs to be a pause until we are clearly on the other side of the crisis. This would help support employment in the short run. Also, people remain free to make voluntary contributions to super if they consider that the contributions from employers are inadequate for their retirement needs.


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 

 

Uncertain

8

It is true that hefty fiscal deficits and government spending are both needed now. This does entail a "substantial increase in public debt". However, the main fiscal objective should not be to "boost aggregate demand"---the RBA has done enough thus far to prevent falling prices.


Wage freeze for economic recovery

Poll 39

"A freeze in the minimum wage will support Australia's economic recovery"

Photo credit: Wes Mountain/The ConversationCC BY-ND 

 

Agree

6

There is currently great uncertainty about inflation down the track. In particular, prices could fall. Even if we froze money wages, real wages could rise, making unemployment unnecessarily high. For such reasons, now is not the time to reduce the flexibility of wages.


Social Distancing Measures, May 2020

Poll 38

"The benefits to Australian society of maintaining social distancing measures sufficient to keep R<1 for COVID-19 are likely to exceed the costs"

 

Agree

8

It is hard to argue with this proposition. We want to continue saving lives and preventing hospitals from becoming overloaded. By the same token we now need to reopen industries, progressively, and conditional at each stage on R remaining less than 1.


Professional Accreditation of Economists - March 2019

Poll 36

Proposition 1: "Professional accreditation for the economics profession would attract more people to economics as a career."

Proposition 2: "The benefits of professional accreditation for current and prospective economists would exceed any possible costs"

 

Part 1 - Agree

6

Part 2 - Disagree

7

Professional accreditation for economists is an appealing notion. But, to paraphrase a song by The Smiths, we just haven't earned it yet. Accreditation needs to await more scientific heft & professional agreement on our part. Take the case of fiscal policy. Tax smoothing theory holds that tax rates should approximate random walks, & was developed in the 1970s. It represents a vast improvement over the Keynesian & classical theories of the 1930s, in terms of explanation of the facts, consistency between macro & micro, prediction of our fiscal future, & advice on budget deficits. Yet the majority of economists probably haven't even heard of tax smoothing. This is just one example of how we need to lift our game. There are various others, partly self-inflicted, & partly the result of a historic lack of useful theory or data. By the same token, our theories, technical skills, computing power & data bases all continue to improve. The day will come when we can put up our hands & demand accreditation.


Royal Banking Commission (II) - February 2019

Poll 35

"There is no way to significantly increase the degree to which Australian retail banks act in the interests of consumers."

 

Disagree

6

A big part of the monopoly power of the established banks has been their informational advantage over other interested parties. The big data revolution is helping to overcome this by enabling non-established lenders to access cheap information on potential borrowers, especially small-business ones. Another cause of the problems is reluctance on the part of the courts to jail white-collar criminals. Mandatory minimum sentences could help.


Congestion pricing - November 2018

 

Agree

7

Yes, the case for congestion pricing comes straight out of Econ101.


Banking Royal Commission and the Credit Crunch - October 2018

Poll 33

Proposition 1: "There is a significant risk that, either as a result of the findings and recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry or as a result of the financial institutions' response to those findings, credit will become less readily available to Australian households or businesses."

Proposition 2: "Assuming credit becomes less readily available to Australian households or businesses, this will in turn have adverse consequences for the performance of the Australian economy."

 

1 - Agree

2 - Agree

1 - Yes, there is indeed a risk of reduced bank credit. In particular, the banks will be wary about class-action litigation, and stricter court interpretations of the responsible-lending laws.

2 - Households and businesses alike look to the banks for funds to acquire assets, especially property.


Sugar sweetened beverage tax for Australia - July 2018

Poll 31

Proposition 1: "The best economic policy instrument available to policy makers seeking to address obesity and related health issues in Australia is the introduction of a tax on sugar sweetened beverages (SSBs)."

Proposition 2: "The health and non-health benefits from a tax on SSBs are likely to outweigh the possible costs felt elsewhere in the economy."

 

1 - Agree

2 - Agree

1 - I agree that sugar confers negative externalities so that there is a Pigou-type case for taxing sweetened products.

2 - The list of chronic health problems from obesity is long and growing.


Will building more homes make housing cheaper? - May 2018

Poll 29

"A sustained increase in the number of new homes constructed each year, all else equal, will make housing cheaper than otherwise."

 

Agree

7

This proposition makes sense.


US corporate tax cuts - March 2018

Poll 27

"The recent US corporate tax cuts will have no impact on investments in and capital flows into Australia."

 

Disagree

7

Australia and the United States have surprisingly similar endowments of resources, and this is a major reason why trade between the two countries is surprisingly muted. Examples include hydrocarbons and agricultural land. As a consequence, the recent US corporate tax cuts are likely to see a substantial redirection of international capital flows, out of hydrocarbons, agriculture and some other Australian industries, and into their US counterparts.


Electric vehicles and road-use pricing - June 2018

Poll 30

"Pricing of road-use for electric vehicles should be the same as fossil fuel-powered vehicles."

 

Agree

6

It seems that carbon emissions per each electric car in Australia are 3 to 4 times as great as carbon emissions per fossil-fuel-powered car, owing to our comparatively high reliance on coal-generated electricity. So if you think that carbon emissions represent a dangerous externality then you would want to impose much higher road-use pricing on electric cars. On the other hand, fossil-fuel-powered cars emit more pollutants other than carbon dioxide. The 2 types of car probably impose similar levels of congestion & road damage. Overall, then, I'm inclined to similar road-use pricing for the 2 types of car.


Australian Federal Budget 2018 - Reduce government debt or provide tax cuts? - April 2018

Poll 28

Proposition 1: "Slowing the growth in the debt to GDP ratio should be a priority for Australian governments."

Proposition 2: "Slowing the growth in the debt to GDP ratio is a higher priority than income or corporate tax cuts."

 

1 - Disagree

2 - Disagree

1 - The net debt of the nonfinancial sector of the federal government has been a mere 18 or 19 per cent of GDP for the last two quarters of available data. Recent federal tax revenues have been surprisingly buoyant, and look set to remain strong for the foreseeable future. So slowing the debt to GDP ratio is not a priority. That would just create room for another burst of spending on pink batts, etc.

2 - Countries in our peer group, including Ireland, the United Kingdom, Canada & the United States, have all successfully implemented deep cuts in corporate tax rates, notwithstanding much higher ratios of debt to GDP. There's no prize for originality in policy, and this maxim applies to our unusually high rate of company tax.


Gig economy and worker welfare - February 2018

Poll 26

"The wages and conditions of Australian workers providing services in sectors affected by the rapid growth of digital on-demand subcontracting platforms will, on average, be expected to fall without further government intervention."

 

Disagree

6

I agree that wages relative to skills will be lower on average in the gig economy than elsewhere, because there is greater freedom of entry into the gig economy, implying lower rents to the productive factors employed within it. However, I expect that the rate of change of wages in the gig economy will be roughly the same as the rate of change of wages elsewhere.


Journalism as a public good - January 2018

Poll 25

Proposition 1: "The modern phenomena of information overload and social-media-fuelled 'fake news' bring into focus the value of quality journalism. Quality journalism has a public-good dimension that warrants public support."

Proposition 2: "The Australian government presently provides funding for the ABC and SBS, Australia's independent public broadcasters. The Australian government should increase its financial support of quality journalism."

 

1 - Uncertain (neither agree nor disagree)

2 - Disagree

1 - The public-good quality of journalism is only partial, given that a pure public good is both non-rivalrous and non-excludable. For example, Sky News is a subscription service that does a good job on a low budget.

2 - I agree with the school of thought that says the ABC has grown too big, even though it has some excellent broadcasters & I watch it more than any other channel. It does not offer a range of viewpoints and, about $1 billion a year, is very expensive.


Same sex marriage - November 2017

Poll 24

"Assuming that the law will be changed to allow same-sex couples to marry in Australia, this will generate net economic benefits for the nation as a whole over the next 10 years."

 

Uncertain (neither agree nor disagree)

5

Don't know. Here's one economic benefit: a Balmain drinking mate of mine who recently became a marriage celebrant should get plenty of extra business.


Robots, artificial intelligence and the 'future of work' - October 2017

Poll 23

Question A: "Holding labor market institutions and job training fixed, rising use of robots and artificial intelligence is likely to increase substantially the number of workers in Australia who are unemployed for long periods."

Question B: "Rising use of robots and artificial intelligence in Australia is likely to create benefits large enough that they could be used to compensate those workers who are substantially negatively affected for their lost wages."

 

A - Disagree

B - Agree

Economic history since the invention of the Spinning Jenny suggests a negative answers to Question A and a positive answer to Question B.


Public borrowing for infrastructure investment - September 2017

Poll 22

"As interest rates are at low levels by historical standards, federal and state governments, despite their public debt levels, should be borrowing more than they currently are to invest in infrastructure"

 

Uncertain (neither agree nor disagree)

7

Interest rates are indeeed low. However, this falls well short of a blanket justification for heavier public investment in infrastructure. Rather, each candidate project needs to be evaluated on a case-by-case basis. Likewise, there is no blanket justification for preferring infrastructure builds by the public (rather than private) sector, as there is plenty of private funding available.


The Finkel Review - August 2017

Poll 21

"The Finkel Review has recommended a mandatory certificate scheme that obliges electricity retailers to purchase a certain proportion of the electricity they sell from sources of electricity whose emission intensity is below a defined level. This is preferable to conventional approaches to the pricing of externalities, such as an emission tax or cap and trade scheme."

 

Disagree

7

If the intention is to moderate emissions of carbon dioxide, then a simple Pigovian-style tax on emissions is far superior, as has been known since pollution problems were first analysed two or three generations ago.


Does privatisation of human services hurt outcomes? - July 2017

Poll 20

"For-profit provision of human services like health and education leads to poor client outcomes and high costs to government."

 

Disagree

7

Health and education services are best provided by a competitive mix of public and private enterprises. Experience shows that exclusively public provision leads to mediocrity and excessive bureaucracy.


Gender diversity in the workplace - role of government? - June 2017

Poll 19

"The recent Parliamentary Inquiry into "Gender segregation in the workplace and its impact on women's economic equality" was asked to examine measures to encourage women?s participation in male-dominated occupations and industries. Although there is growing awareness of the productivity gains of gender diversity, the private market alone is unlikely to steer the Australian labour market toward gender equality in male-dominated industries. Breaking down gender segregation in the labour market can only be achieved with some degree of government intervention."

 

Disagree

6

Female academics do add on average at least as much value as their male colleagues. However, discrimination in hiring should be countered informally rather than by formal and coercive methods, regardless of the group that is facing discrimination.


Australian Federal Budget 2017 - Outsourcing Economic Forecasting - May 2017

Poll 18

"Given the Commonwealth Treasury?s ongoing difficulty in making accurate forecasts of some of the key economic variables underpinning the Budget ? in particular nominal GDP growth ? the Government should ?outsource? the economic forecasts used in framing the Budget to an independent agency (such as the Parliamentary Budget Office), as now happens in the United Kingdom."

 

Disagree

8

There's a lot of useful information impounded in budget forecasts of revenue growth and nominal GDP growth, at least for one year ahead, and notwithstanding the fact of demonstrable room for improvement in forecasting accuracy. For details, see my article with Lance Fisher in the March 2017 issue of the Australian Economic Review. The closer I examined Treasury's track record over the last couple of decades, the more I was impressed with the superiority of Treasury methods over simple predictive regressions. What the critics fail to show is that they could come up with superior forecasts without any reliance on official ones. I'm not aware of any evidence that the UK's outsourcing procedure has resulted in more accurate forecasts by the official family in that country.


Energy shortages - reserving Australian gas - April 2017

Poll 17

"In response to energy shortages around Australia, government policies requiring gas producers to reserve some production for domestic consumption are a good way to ensure that Australian consumers have access to sufficient gas supplies while still allowing for gas exports."

 

Disagree

7

Like other providers of goods and services, gas producers should be free to sell as much as they want, and on the best terms they can get. What is needed in the market for natural gas is fewer bans on exploration. If farmers with land above deposits could be cut in on (say) 10% of the profits, that would weaken the lobby against exploration.


CGT deductions - March 2017

Poll 16

"Capital gains tax deductions for housing investment should be removed because they overstimulate the housing market, contributing to rising house prices."

 

Disagree

6

There should be a level playing field for the tax treatment of capital gains across different investment vehicles. What is needed is a lower effective tax rate on investments in superannuation by people of middle means. That would take some pressure off housing prices, as well as reducing calls on the Age Pension.


Economics teaching - micro before macro - February 2017

Poll 15

"It is more effective to teach an introductory course in micro-economics first before an introductory course in macro-economics."

 

Disagree

7

Starting an economics course with macro helps to ground the subject. Students can more easily relate their classes to stories in the media, and learn that facts trump theories, at least to the extent the two things can be separated. Notably, the national accounts are very educational. Macro controversies can be used to enliven the course. Caveats here are that the introductory macro course should be applied (not overloaded with multiplier formulas of dubious veracity) and should present both sides of the controversies.


Social costs of gambling - December 2016

Poll 14

"The social costs of gambling exceed the benefits (including consumer surplus from recreational gambling and tax revenue for governments)."

 

Uncertain (neither agree nor disagree)

5

I would agree that watching someone play the pokies is unedifying. On the other hand, we need a certain amount of randomness in our lives--why else do we have children?


2016 US Election - November 2016

Poll 13

"Hillary Clinton is likely to be the superior US presidential candidate for the Australian economy and for Australia."

 

Uncertain (neither agree nor disagree)

5

Hillary Clinton looks like a more responsible individual than Donald Trump. She is less likely to institute damaging barriers to international trade. On the other hand, she did not shine as Secretary of State, looks as if she will retain the growth-sapping company tax rate in the United States (39 per cent), and could waste public money on the kind of politicised and low-productivity infrastructure we saw here in Australia during the Rudd-Gillard era.


Part 1: 'Behavioural economics provides new and useful insights into individual behaviour.' Part 2: 'It is unethical for governments to use behavioural economics to

The total benefit of current levels* of migration to Australia will outweigh the total costs to Australia's economy.

 

Agree

7

At least in the subfield of retirement economics, behavioural notions have been fruitful. Professor John Campbell's presidential address to the American Economic Association this year makes this point persuasively.


Immigration - November 2016

Poll 12

'The total benefit of current levels* of migration to Australia will outweigh the total costs to Australia's economy'.

 

Disagree

6

For some time the main drivers of immigration policy have been MPs helping constituents to bring in family members, often at the expense of taxpayers rather than the reuniting family, along with the building and construction lobby, which benefits more from capital widening than capital deepening. There needs to be a bigger role for a more hard-nosed policy that emphasises skills in short supply to the Australian economy.


Behavioural economics - September 2016

Poll 11

Part 1: 'Behavioural economics provides new and useful insights into individual behaviour.'

Part 2: 'It is unethical for governments to use behavioural economics to "nudge" citizens.'

 

PART 1 - Agree

6

Again in the subfield of retirement economics, there are emerging signs of misuse of nudge economics. For example, the push by the Australian authorities to nudge retirees into deferred annuities is at odds with the interests of people hitting retirement with modest super but without their own home. Such people need to go into retirement on the Age Pension and as home owners, to avoid missing out on the strongly preferential treatment of home owners by the means tests. They are better off financing late retirement via the Age Pension rather than a deferred annuity.

PART 2 - Agree

6

Again in the subfield of retirement economics, there are emerging signs of misuse of nudge economics. For example, the push by the Australian authorities to nudge retirees into deferred annuities is at odds with the interests of people hitting retirement with modest super but without their own home. Such people need to go into retirement on the Age Pension and as home owners, to avoid missing out on the strongly preferential treatment of home owners by the means tests. They are better off financing late retirement via the Age Pension rather than a deferred annuity.


RBA economic growth targets - August 2016

Poll 10

"The Reserve Bank of Australia should be tasked with targeting nominal economic growth rather than inflation."

 

Disagree

7

Targeting inflation is superior to targeting nominal GDP, although the current target band of 2-3 per cent needs to be revised downwards, to 1-3 per cent.         One weakness of targeting nominal GDP is that it would lead to excessively low interest rates whenever there was a secular decline in the rate of growth of real income. Indeed, this kind of secular slowdown currently bedevils our economy.        Another weakness is that monetary policy would probably be excessively anti-cyclical. At the peak of commodity booms, for example, we would see a severe 'Dutch disease' effect bearing down on non-commodity exports and import-competing industries, e.g. education, tourism, property, financial services and manufacturing They would face very high nominal and real exchange rates, leading to excessive rotation through the cycle of resources in and out of sectors producing non-commodity tradables.


The Brexit - impact on UK citizens - July 2016

Poll 9

"Assuming it is implemented, Brexit will deliver net economic benefits, on average, to UK citizens within its first 5 years."

 

Disagree

6

Brexit will probably entail significant economic costs in the short run. Notably, multinational corporations, especially ones in financial services, will consider relocating their European headquarters from London to Frankfurt or Dublin. But the Brexit vote was about sovereignty rather than short-run economics. Moreover, if "economic benefits" are defined in per capita terms, Britain could benefit economically in the long run, especially if continental Europe fails to secure its borders.


Spend on education or business tax cut - June 2016

Poll 8

"Australia will receive a bigger economic growth dividend in the long-run by spending on education than offering an equivalent amount of money on a tax cut to business."

 

Disagree

7

Over the last decade, public spending on education seems to have been largely captured by vested producer interests, without creating a higher stock of human capital in Australia. Ireland has done well out of cutting company tax to 12.5 per cent, notwithstanding the setback of the global financial crisis, which saw the Euro rise strongly against the pound sterling--the currency of Ireland's biggest export market. Likewise, New Zealand has done well out of cutting company taxes to 28 per cent. For example, a number of businesses have shifted head offices to NZ. Accordingly, the better option is a cut in company tax, financed either by higher personal income tax or a rise in the GST.


Budget 2016-17 - Returning to surplus - May 2016

Poll 7

"The recently released 2016-17 Commonwealth Budget projects that the Australian Government's underlying cash balance will return to surplus by 2020?21*. Australian politicians should rebalance the budget with greater urgency."

 

Disagree

7

The Swan-Hockey era saw over-estimates of tax receipts for 8 fiscal years in a row. The inaugural Morrison budget of 2016-17 will probably mark the ninth successive occasion on which revenue growth has been over-estimated. This chronic over-estimation on the part of Treasury is unnecessary, as the efficiency and accuracy of budget forecasts of tax revenue can readily be improved by a simple adjustment involving National Accounts data on household saving behaviour.


China services boom for Australia? - April 2016

Poll 6

"As the Chinese economy makes its transition from investment-led to consumption led growth, the Australian service sector which currently accounts for around 20% of total exports, will produce a second 'Chinese economic windfall' for Australians."

 

Agree

7

There are indeed good prospects for expanding service exports to China. In particular, our exports of education, tourism and financial services should prosper, subject to the qualification that our withholding tax regime needs to be more generous if we want to become a regional hub for funds management.


Efficiency of tax Government investments in major sporting events - February/March 2016

Poll 5

"Government investments in major sporting events usually generate net benefits for the city or region where the investment is made."

 

Agree

2

I guess there is a decent chance that a sporting event will generate positive externalities for the host city, but more information is needed before this type of question can be answered with any confidence.


Efficiency of tax incentives - February 2016

Poll 4

"New tax incentives for investments in technology and innovation businesses and start-ups are likely to be inefficient."

 

Agree

4

Tax breaks targeted at specific industries or business structures are attempts by governments to pick winners. Low business taxes are efficient, but should be across the board.


Bah Humbug Australia - December 2015

Poll 3

"Giving specific presents as holiday gifts is inefficient, because recipients could satisfy their preferences much better with cash."

 

Disagree

6

Occasions such as Christmas are an excuse to give one another luxuries that our normal, prudent & boring selves choose to forego.


Penalty Rates Reform - November 2015

Poll 2

"Aligning Sunday penalty rates for hospitality, entertainment and retailing industries with the current levels for Saturday, as proposed in the Productivity Commission's draft report, will lead to more employment and greater availability of services in these industries on Sundays."

 

Strongly agree

8

The current industrial-relations practice of differentiating Sunday from Saturday has become an anomaly, in view of the current levels of church attendance.