Volume 42, Issue 3, 2012

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Articles:

I POLICY DEBATES AND CONTROVERSIES
  • Economic Benefit, or Regressive Taxation and Wealth Transfers? (Tim Nelson, Paul Simshauser, and James Nelson)
II RECENT TRENDS IN ECONOMIC RESEARCH
  • Inflation, Inflation Uncertainty and Macroeconomic Performance in Australia (Ramprasad Bhar and Girijasankar Mallik)
  • Gender Differences in Domains of Job Satisfaction: Evidence from Doctoral Graduates from Australian Universities (Temesgen Kifle and Isaac H. Desta)
  • Weak Policy in an Open Economy: The US with a Floating Exchange Rate, 1974-2009 (Henry Thompson)
  • International Influences on the Australian Economy in the Interwar Years (Tom Valentine)
  • Generalized Network Externality Function (Arnut Paothong and G.S. Ladde)
  • Investigating the Interaction Effect of Democracy and Economic Freedom on Corruption: A Cross-Country Quantile Regression Analysis (Shrabani Saha and Jen-Je Su)

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Queensland Solar Feed-In Tariffs and the Merit-Order Effect:
Economic Benefit, or Regressive Taxation and Wealth Transfers?

Tim Nelson, Paul Simshauser, and James Nelson

Pages: 277-301

Abstract: Premium residential solar feed-in tariffs have come under considerable scrutiny in Australia over the past 12 months following a sharp rise in the uptake of subsidised PV units and subsidy cost blow-outs. Using New South Wales data, Nelson, Simshauser and Kelley (2011) demonstrated that the inherent design of premium ‘gross’ feed-in tariffs are regressive in nature and required reform. Since the publication of that article in Economic Analysis & Policy (September 2011 edition), feed-in tariff policies have been substantially wound back in all Australian jurisdictions except Queensland. In this article, we examine the ‘net’ feed-in tariff in Queensland and similarly find it to be a regressive form of taxation. We also examine the so-called ‘merit order effect’ – a purported ‘economic benefit’ arising from premium feed-in tariffs. However, the evidence is clear that merit order effects must, by definition, be transient and above all, are not welfare enhancing.

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Inflation, Inflation Uncertainty and Macroeconomic Performance
in Australia

Ramprasad Bhar and Girijasankar Mallik

Pages: 305-318

Abstract: Using quarterly data this study finds that inflation uncertainty have negative and significant effects on inflation and output growth at least after the inflation targeting. We also find that output uncertainty has negative and significant effect on inflation. The study uses a newly constructed oil price dummy variable as a control variable and finds that oil price changes significantly increase the inflation uncertainty. These findings are robust and the Generalised Impulse Response Functions corroborate the conclusions. These results have important implications for inflation targeting (IT) monetary policy, and the aim of stabilisation policy in general.

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Gender Differences in Domains of Job Satisfaction: Evidence from Doctoral
Graduates from Australian Universities

Temesgen Kifle and Isaac H. Desta

Pages: 319-338

Abstract: Based on data from a study of graduates from PhD programs at Australia’s Group of Eight (Go8) universities, a gender gap in job satisfaction domains is estimated using a Mann-Whitney U test. Findings from the aggregate model show significant gender differences in only 5 out of 17 domains of job satisfaction. Further, separate analyses by age, employment status and family type/living arrangement broadly support the absence of gender differences in domains of job satisfaction. For aspects of job satisfaction that show significant gender differential it is found that males are more satisfied than females with their hours worked, opportunity for career advancement and workload, whereas females are more satisfied than males with their relationship with co-workers and contribution to society. This implies that males are more satisfied with intrinsic dimensions of job satisfaction while females are more satisfied with extrinsic aspects of job satisfaction.

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Weak Policy in an Open Economy:
The US with a Floating Exchange Rate, 1974-2009

Henry Thompson

Pages: 339-350

Abstract: This paper examines the effectiveness of US macroeconomic policy in an open economy model focused on the exchange rate and trade balance. Yearly data cover the period of the dollar float from 1974 to 2009. Monetary expansion raises output weakly but depreciates the dollar and lowers the trade balance. Fiscal “expansion” decreases output. There is a polar deficit effect between the government budget and trade balance. These results question a number of standard policy prescriptions. The implied structural coefficients suggest rethinking a number of accepted theoretical assumptions.

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International Influences on the Australian Economy
in the Interwar Years

Tom Valentine

Pages: 351-361

Abstract: This paper examines the role of global factors in the Australian economy in the interwar years. In particular, it evaluates the impact of export prices on the Australian rate of inflation, the rate of growth of the economy and the unemployment rate.In the first analysis inflation is decomposed into two sources-one due to the growth of wages and the other due to the growth of non-wage income. The latter depends strongly on the growth in export prices. A macroeonometric model shows that export prices affected economic growth and the unemployment rate which was also negatively related to wages and the tariff rate. The increase in the latter was a poor policy option. It also appears that the Depression was imported into Australia via the fall in export prices rather than the drop in share prices.

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Generalized Network Externality Function

A. Paothong and G.S. Ladde

Pages: 363-367

Abstract: In this work, we focus on the development of mathematical modeling of network externality processes. The introduction of the generalized network externality function provides a unified source of a tool for developing and analyzing the planning, policy and performance of the network externality process and network goods/services in a systematic way. This leads to fulfill all existing network externality assumptions as special cases. We study its properties and applications. This study provides quantitative descriptions, parametric representations of attributes and sensitivity analysis of network externality processes. In particular, parametric variations characterize planning, policy and performance for network goods. Furthermore, by using the US banking asset and deposit time series data sets and statistical methods, the dynamic model of network externality of the US banking asset with respect to the normalized US banking deposit as the financial market share is developed to illustrate the concept of generalized network externality process.

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Investigating the Interaction Effect of Democracy and Economic Freedom
on Corruption: A Cross-Country Quantile Regression Analysis

Shrabani Saha and Jen-Je Su

Pages: 389-396

Abstract: This paper explores the interaction effects of economic freedom and democracy in controlling corruption for 100 countries by using quantile regression technique. The main contribution is to explore the interaction effects throughout conditional distribution of corruption across nations. Our results reinforce some findings in the literature, but also provide new conclusions. The findings suggest a stronger and significant interaction effect in reducing corruption, especially in the most-corrupt countries. However, democratic and economic freedoms alone may not cure corruption effectively in the most-corrupt nations, a sound democratic reform can eliminate corruption substantially only after achieving a threshold level of economic freedom.

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