Economics - Research Publications
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ItemMobile Network Competition, Customer Ignorance and Fixed-to-Mobile Call Prices( 2000-02)This paper examines the influence of mobile network competition on the prices of fixed-to-mobile calls. Because fixed line customers cannot, in general, distinguish the identity of a specific mobile network, these networks have market power when setting termination charges for calls from fixed lines. We show that: (1) unregulated mobile termination charges will result in higher than monopoly call prices; (2) the regulation of termination charges and prices downward will affect mobile subscription rates and may lower these rates; and (3) regulation of any mobile carrier's termination charges can reduce fixed to mobile prices but will result in an increase in unregulated carriers' termination charges. When fixed line consumers can distinguish between the different mobile networks they are calling, fixed to mobile call prices will fall relative to their level under customer ignorance. Direct mobile charging for termination also exerts downward pressure on the total fixed to mobile call price. A low cost method of lowering fixed to mobile charges would be to facilitate the identification of carriers by consumers and to restructure billing so that mobile networks are able to directly charge fixed line consumers for termination services
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ItemUsing 'Bill and Keep' Internconnect Arrangements to Soften Network Competition( 2000-03)This paper demonstrates that low (below marginal cost) interconnect or access charges can be used to sustain high subscription prices in an environment of network competition with two-part tariffs and price discrimination. This result stands in contrast to other results in the literature suggesting that high interconnect charges can play a collusive role.
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ItemExchange rate volatility and macroeconomic performance in Hong Kong( 2000-05)In this paper evidence on whether Hong Kong's currency board arrangement, in place since 1983, has affected the volatility of real macroeconomic variables is presented. Simple evidence on the relative volatilities of relevant macroeconomic variables pre and post 1983 is presented, before a more formal econometric framework is utilised to examine the linkages between the exchange rate and the real economy. It is found that the currency board period has been one of relative stability in Hong Kong, though it has also been a period where external factors have been relatively benign. Even after controlling for the external environment it is found that the currency board period is one of low macroeconomic volatility
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ItemThe Displacement Hypothesis and Government Spending in the United Kingdom: Some New Long-Run Evidence( 2000-06)This paper presents new evidence on the ability of Peacock and Wiseman'sdisplacement hypothesis to explain temporal increases in the ratio ofgovernment expenditure to GDP in the United Kingdom. Using univariatemodelling techniques that are robust to structural changes in the underlyingdata generating process and a data set extending back to 1836, we find fourinstances where displacement may be said to have occurred.
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ItemDoes structure dominate regulation? The case of an input monopolist( 2000-10)This paper constructs a simple repeated game model to analyze how industry outcomes alter if a regulated input monopolist is allowed to integrate into the downstream retail market. Integration helps overcome double marginalization — a feature well known in the existing literature. Unlike existing static models, however, integration also makes tacit collusion more difficultin a repeated game framework. If the regulated input price exceeds marginal cost, an integrated monopolist has an incentive to increase retail sales as this raises upstream profits. It will be less willing to engage in any tacitly collusive conduct in the downstream market and it has a greater incentive to cheat on any collusive arrangement. We show that these effects may dominate input price regulation. A social planner may prefer the upstream monopoly toparticipate in the downstream market, even if integration leads to a higher regulated input price. The anti-competitive effects of the higher input priceare more than offset by the pro-competitive effects of integrati
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ItemSome current issues of international monetary policy( 2000-07)This paper addresses some current policy issues relating to international monetary arrangements. There is first a discussion of some questions relating to the International Monetary Fund, including its role as a possible lender of last resort to prevent future international financial contagion. Some arguments relating to Britain's possible entry into the euro system are also raised, with principal attention to Britain's transactions with the non-euro countries. Some issues of exchange rate policy, including currency unions, for countries outside the euro area and the United States are also discusse
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ItemHousehold production and the household economy( 2000-07)Household production is the production of goods and services by the members of a household, for their own consumption, using their own capital and their own unpaid labor. Goods and services produced by households for their own use include accommodation, meals, clean clothes, and child care.The process of household production involves the transformation of purchased intermediate commodities (for example, supermarket groceries and power-utility electricity) into final consumption commodities (meals and clean clothes). Households use their own capital (kitchen equipment, tables and chairs, kitchen and dining room space) and their own labor (hours spent in shopping, cooking, laundry and ironing). The total economic value added by households in household production has been aptly named Gross Household Product (GHP) (Eisner, 1989; Ironmonger, 1996
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ItemExchange rates and macroeconomic policy with income-sensitive capital flows( 2000-11)This paper considers some implications for macroeconomic policy in an open economy if – as appears highly probable – international flows of capital are now significantly sensitive to changes in income, and to expected changes in income, in different countries. This assumption is in contrast to that in accepted analysis where international capital flows are sensitive only to relative interest rates in different countries. One conclusion is that the effects on the exchange rate (or on the reserves in a fixed exchange rate system) of monetary policy in an open economy will be less than if it is assumed that capital flows react only to changes in interest rates. The effects of fiscal policy changes upon the exchange rate (or the reserves if the exchange rate is fixed) will also be more likely to be largely or fully offset by capital flows than if relative interest rates alone affected the flow of capital. It will, however, remain true that so long as capital flows react also to some extent to relative interest rates, monetary policy retains a comparative advantage over fiscal policy in affecting the exchange rate, or the level of reserves in a fixed exchange rate system. It is also concluded that if capital flows react to changing levels of income, a shift from fixed to flexible exchange rates will have less effect in increasing the domestic effects of changes in monetary policy; and will be less likely to increase the domestic effect of changes in fiscal policy
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ItemAustralian Economic Growth: Non-linearities and International Influences( 2000-03)This paper considers the extent to which fluctuations in Australian economic growth are affected by domestic and overseas economic performance. We investigate the performance of a range of non-linear models versus linear models, comparing the models using Bayes factors and posterior odds ratios. The posterior odds ratios favour non-linear specifications in which luctuations in economic activity in the US affect Australia's economic performance. Our results suggest that an exogenous negative shock will be more persistent, lead to greater output volatility, and have a greater impact on growth, than a positive shock of equal magnitude.
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ItemEnriching the learning experience: a CALM approach( 2000-12)This paper outlines and evaluates a new learning strategy implemented in the Faculty of Economics and Commerce at the University of Melbourne. The strategy is an Internet based assignment delivery and assessment system designed to (i) equip students to make the link between macroeconomic theory and important real-world issues, (ii) develop positive attitudes to the subject iii) develop deep approaches to learning (iv) develop a facility for critical analysis and problem solving and v) develop effective study habits. Using a multi-dimensional evaluation strategy, the indications are that the new approach has succeeded in its aim.