Economic Papers最新文献

The author recounts notable issues and developments in the Australian federal government's management of the economy over the fifty years since 1974, relying on his knowledge of events he observed as an economic commentator speaking with public servants, academics and politicians and writing several times a week in The Sydney Morning Herald and, for much of that time, The Age, Melbourne. Events include the arrival of stagflation in the early 1970s, the loss of faith in Keynesian remedies, the flirtation with Friedman's monetarism and attempts to control the money supply, the switch from fiscal policy to monetary policy as the dominant instrument for economic demand management, the rising influence of the central bank and the adoption of inflation targeting. Other issues of concern included the balance of payments, the twin deficits hypothesis and the goals of microeconomic reform, since known as neoliberalism. The paper represents reflections from a prominent economic journalist in Australia.

Climate change is a global challenge that demands collective action, especially as a significant portion of the population—more than half—lacks access to formal financial systems. Addressing these challenges is critical for achieving sustainable development (SD). In the context of global economic shifts toward digital transformation and the increasing role of digital technology in finance, digital financial inclusion (DFI) is expected to be a key driver in advancing SD across countries. This study examines the impact of DFI on SD in ASEAN countries from 2007 to 2022. Using Bayesian methods, which effectively address issues such as small sample sizes, autocorrelation and endogeneity, the results show that DFI generally promotes SD. However, when considering economic cycles, DFI can have a negative impact on SD. When examining the effects of DFI on SD in individual countries, the findings indicate that DFI positively influences SD in Indonesia, Myanmar, Thailand, Singapore and Vietnam, while it has a negative effect in Cambodia, Malaysia and the Philippines. Based on these findings, the study suggests the following policy implications.

This article is about the interaction between policymaking and research and also between policymakers and academia: what that should look like, and whether that is working as well as it could at the moment. The wealth of data and computational capabilities today, coupled with the breadth and depth of theory, could be usefully channelled into better applications to address economic issues and support policy reforms.

Using data from the Global Findex surveys conducted in 2017 and 2021, this study assesses the extent and determinants of multidimensional financial inclusion in the West African Economic and Monetary Union (WAEMU) over these two periods. A multidimensional financial inclusion index was constructed using the methodology of Alkire and Foster (2011). To analyse the determinants and drivers of multidimensional financial inclusion, a probit model and Fairlie's (2005) decomposition were employed. Although the results indicate an increase in the level of multidimensional financial inclusion in the WAEMU, the rate of multidimensional financial exclusion remains high. This improvement in financial inclusion between the two periods can be attributed to changes in individuals' socio-economic characteristics. The findings also reveal significant disparities in financial inclusion between men and women, as well as among WAEMU member countries. In addition, significant relationships were observed between individuals' socio-economic characteristics and their multidimensional financial inclusion status. Policies aimed at promoting better economic opportunities and improving education levels are essential for increasing the rate of financial inclusion in the WAEMU.

This study estimates effective rates of protection for 33 manufacturing industries in Victoria in 1880. These estimates lead to eight observations. Notably, the effective rates of protection suggest that the magnitude of protection in late-nineteenth-century Victoria was considerably less than in the other industrialising, settler economies of Canada and the United States—to a more pronounced degree than suggested by nominal tariff levels. Also, colonial Victoria exhibits a very high correlation between nominal tariffs and effective rates of protection. This finding should enhance the confidence of economic historians in using the former as a proxy for the latter.

Conventional neoclassical trade theory predicts that China's emergence from autarky would lift the relative price of labour-intensive products in that country and lower their relative price in most trade-exposed countries in the developed world, inducing a shift in those countries towards less capital-intensive modes of production, lowering rates of growth in both labour productivity and real wages. These impacts appear to have had political resonance in the United States. In that country, sharp adjustments in the prices of traded goods and services have delivered a lower terms-of-trade, a persistent current account deficit and a trade deficit with China. In Australia, the same adjustments in international prices have delivered a much higher terms-of-trade, a narrowing in the current account deficit, even a trade surplus in some years, and a trade surplus with China. Impacts on a country's terms-of-trade, current account balance and bilateral trade balances are irrelevant to an understanding of the implications for productivity and real wages of China's embrace of globalisation. But political leaders in both the United States and Australia evidently do not get it. Captured by a mercantilist mindset, Australia's leaders celebrate higher export prices, choosing to believe a dangerous myth, that the “mining boom” has been critical to Australian prosperity in the 21st century, even though workers have done poorly. Consistent with neoclassical trade theory, the Australian mining boom provides a plausible explanation for a couple of decades of very weak productivity growth and a fall in real wages. Standard international macroeconomic analysis tells the same story. In response to China's industrial expansion, Australian policy makers should have embarked on an ambitious programme of productivity-enhancing economic reforms, as they did in implementing the tariff reforms of the late 20th century. Instead, this century's celebration of the mining boom myth has delivered a torpor of policy complacency that has sold Australian workers down the drain. Australia's economists have been far too tolerant of this complacency. We should have been using our insights to assist in the construction of narratives for the nation's future that are based on reason, not mythology.

This study investigates the impact of public education expenditure on income inequality, focusing on the moderating role of public debt. Using a dataset of 74 developing countries spanning 1974–2022, the analysis applies the System Generalised Method of Moments (GMM) and the Dynamic Panel Threshold Regression Model (DPTRM). While previous research has predominantly examined the linear relationship between education expenditure and income inequality, this study further explores their nonlinear dynamics in the presence of public debt. The System GMM findings confirm that an increase in public education expenditure reduces income inequality, consistent with existing literature and the inverted U-shaped hypothesis. Furthermore, the study finds evidence of a nonlinear relationship between public education expenditure and income inequality; more specifically, a significant threshold effect of public debt is identified. Below the threshold level of the public debt-to-GDP ratio, increased education expenditure effectively reduces income inequality. Conversely, above the threshold, the impact of education expenditure on inequality becomes positive and loses statistical significance. The study offers a novel perspective for policymakers, emphasising that the effectiveness of education policy interventions, particularly education spending, is contingent on macroeconomic conditions such as debt sustainability.

The outbreak of the Coronavirus (COVID-19) pandemic led to global economic consequences. This paper measures the dynamics of spillover effects before and during the COVID-19 pandemic among Asia-Pacific banks. Spillover effects provide an accurate representation of the transmission of shocks across financial institutions during adverse events, such as the COVID-19 pandemic. We apply the Diebold-Yilmaz spillover index to investigate the impact of COVID-19 on spreading shocks in the banking system. We consider the interactions of the 50 largest banks in the Asia-Pacific region over the period 1 January 2018 to 18 November 2021. The empirical results show varying patterns of spillover before and during the COVID-19 pandemic. The total spillovers intensify following the COVID-19 outbreak. Total spillovers decreased after governments adopted measures to mitigate the spread of COVID-19, including lockdowns, social distancing, wearing face masks, and vaccinations. This shows that the COVID-19 pandemic led to an increase in systemic risk. Caution needs to be put in place to monitor these banks to reduce instability in the banking sector.

In this paper, we investigate the performance of five causality-detection methods and the aggregation of their results when considering multiple units in a panel data setting. We employ voting rules as an aggregation procedure to determine which causal paths are identified for the sample population. Using both simulated and real-world panel data, we show the performance of these methods in detecting the correct causal paths by comparing them to a benchmark that represents a standard growth model as the ground truth.

This paper investigates the transmission mechanisms through which geopolitical risk (GPR) shocks affect Federal Reserve (Fed) monetary policy, incorporating both conventional and unconventional policy tools. It introduces a structural model – the Macro-Monetary Geopolitical Risk (MM-GPR) model – that integrates New Keynesian features, such as nominal frictions and rational expectations. The findings indicate that GPR significantly impacts the economy, prompting corresponding responses from the Fed. Heightened geopolitical uncertainty leads to rising inflation, suppressing real economic activity by reducing consumption and investment, while increasing unemployment. Two monetary policy experiments simulate the Fed's expansionary and contractionary responses under GPR surges and reliefs. The results reveal that, whether GPR rises or subsides, the optimal monetary policy for the Fed remains expansionary. These findings offer crucial guidance for policy-makers in navigating monetary policy amid geopolitical uncertainty. This paper contributes to both theoretical and empirical macroeconomic and monetary policy modelling by incorporating GPR shocks into the monetary policy framework, addressing a key gap in existing structural models by including unconventional policy tools.