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Global perspectives on economic policy

Pluralistic, international, policy focused
We explore economic policy from an evidence-based, global perspective. By investigating how macroeconomic and trade policies impact open economies, we focus on relevant settings for Australia and the Asia-Pacific region.

The policy challenges and options available to policymakers in open economies such as Australia’s are very different to those in the United States or Europe, which have been the typical focus of most economic policy analysis.

Central banks and fiscal authorities in open economies have to take full account of how their policies interact with exchange rates, international capital flows and trade flows. At the same time, openness leads to opportunities such as lower costs of finance and greater possibilities for addressing intergenerational inequalities through sovereign wealth funds.

Our research involves interaction and collaboration with policymakers throughout the Asia-Pacific region and elsewhere to develop useful models for economic policy analysis from a global perspective.

Our podcasts

Listen to our podcasts exploring important perspectives on global economic policy.

Guest:

Greg Kaplan is a Professor of Economics at the University of Chicago. Professor Kaplan completed an undergraduate degree at Macquarie University before beginning a masters at the London School of Economics and receiving a PhD from New York University in 2009.  He has held positions at several leading US universities including Princeton, the Universities of Pennsylvania and Chicago. Since 2018 he has served as an editor at the Journal of Political Economy. He has also held several visiting positions at central banks including the Reserve Bank of Australia, Bank of Canada and in the US Federal Reserve system. His research is varied spanning macroeconomics, labour economics, and applied microeconomics, with a focus on the distributional consequences of economic policies and economic forces.

Hosts:                                          

Professor Mariano Kulish, The University of Sydney

Associate Professor Aarti Singh, The University of Sydney

Dr Christopher Gibbs, The University of Sydney

About the podcast:

In this episode, we speak with Greg about his path to studying economics and his research interest in the macroeconomics of inequality. We also discuss Greg's new paper, “The Great Lockdown and the Big Stimulus: Tracing the Pandemic Possibility Frontier for the US.” The paper integrates an expanded SIR model of virus spread into a macroeconomic model with realistic income and wealth inequality as well as occupational and sectoral heterogeneity. The paper introduces the notion of a “pandemic possibility frontier,” which summarises economic and health costs associated with different mixes of nonpharmaceutical interventions, i.e. lockdowns, and economic policy support options.

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More information:

The Great Lockdown and the Big Stimulus: Tracing the Pandemic Possibility Frontier for the US – Kaplan et al. (2020)

A contribution to the Theory of Economic Growth – Solow (1956)

Optimal Mitigation Policies in a Pandemic – Jones et al. (2020) (last episode)

Uninsured Idiosyncratic Risk and Aggregate Saving – Aiyagari (1994)

Guest:

Callum Jones is an Australian economist working in the research department at the International Monetary Fund. Prior to his work at the IMF, Dr Jones completed a PhD in Economics at New York University after working in the research department at the Reserve Bank of Australia. His main field of research is in macroeconomics with a particular focus on monetary policy.

Panel:                                          

Professor James Morley, The University of Sydney

Professor Mariano Kulish, The University of Sydney

Dr Christopher Gibbs, The University of Sydney

About the podcast:

In this episode we discuss a recent working paper exploring economic decisions during a pandemic with one of the authors, Dr Callum Jones. The authors incorporate features of SIR-type epidemiological models to an economic neoclassical-type model where informed agents make economic decisions in light of a developing pandemic. A social planning problem is then introduced to study what the optimal response is to the pandemic, and how this differs from the approach of individual agents.

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More information:

Optimal Mitigation Policies in a Pandemic

The SIR Model for Spread of Diseases

Longer-Run Economic Consequences of Pandemics

The Macroeconomics of Epidemics

Panel:

Professor Bruce Preston, The University of Melbourne       

Professor James Morley, The University of Sydney

Professor Mariano Kulish, The University of Sydney

Associate Professor Aarti Singh, The University of Sydney

Dr Christopher Gibbs, The University of Sydney

About the podcast:

In this episode we address questions posed by students relating to the COVID-19 crisis and associated policy responses.

Questions from our audience:

  1. Money doesn’t grow on trees, so who is paying for this income support? If it’s ‘future taxpayers’, how does that actually happen? It's not like future taxpayers are paying taxes, sticking cash in an envelope, and sending the money back to us in a time machine.
  2. What is the relevance of MMT (Modern Monetary Theory) at the moment and should we be worried about the debt burden?  
  3. The JobKeeper payments are not means tested. Why might this policy have been chosen over a means tested policy, and what are the implications of not means-testing the payments?
  4. Can we just put rent and mortgages on ice? Pause rent, pause mortgages. Once the crisis is over we can start paying them again, but why not just pause all payments for now?
  5. Emerging economies don’t seem to have the same resources that more developed countries like Australia to provide stimulus. What can these countries do to reduce the macroeconomic impact of Covid-19?
  6. Developing countries usually rely on the multilateral banks (IMF, World Bank) in times of economic crisis. Given the global scale of the pandemic, do these institutions have the resources necessary to support countries? What alternative measures can be taken?

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More information:

Modern Monetary Theory

Noah Smith on MMT (mentioned in podcast)

Can Negative Supply Shocks Cause Demand Shortages?

Panel

Professor Bruce Preston, University of Melbourne

Professor James Morley, University of Sydney

Professor Mariano Kulish, University of Sydney

Associate Professor Aarti Singh, University of Sydney

Dr Christopher Gibbs, University of Sydney

About the podcast

In this episode we discuss the recent fiscal policy responses by the many federal governments, primarily Australia, in response to the COVID-19 crisis.

In Australia there have been four major rounds of fiscal stimulus announced in March ranging from policies providing additional funds to those made redundant to guaranteeing loans, and the most recent “JobKeeper” program. Similar stimulus programs ranging from roughly 10 to 15 percent of GDP have been tabled in the UK, US and many economies.

How persistent is this shock expected to be? How effective would we expect a fiscal response to be given the potential nature of this (demand) shock? In particular, what impact might we expect to see from the Australian government’s recent measures? Are the currently announced policies going to be enough to see us through the resulting downturn?

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More information

Chris Edmond and Bruce Preston’s Article in the Australian

The Shape of Things to Come

JobKeeper Payment

Australian Treasury’s Current Responses To COVID-19

Guest

Bruce Preston is a professor of economics at the University of Melbourne. Professor Preston has worked as an economic advisor for a number of public bodies including the Reserve Bank of Australia and Australian Treasury. His main fields of research are monetary and fiscal policy in particular highlighting the implications of learning, expectations and imperfect knowledge.

Hosts

Professor James Morley, University of Sydney

Professor Mariano Kulish, University of Sydney

Dr Christopher Gibbs, University of Sydney

About the podcast

In this episode we discuss the recent monetary policy response by the Reserve Bank of Australia in response to the COVID-19 crisis.

On 18th March the Reserve Bank Board met for the second time in a month – the second unscheduled meeting in its history – to discuss a comprehensive package to support the Australian economy. The four main points of this package included; i) a reduction in the cash rate target to 0.25%, ii) a target on 3-year Australian Government bonds of around 0.25%, iii) the creation of a term funding facility for the banking system – particularly focusing on small and medium-sized businesses, and iv) a shift in remuneration of exchange settlements balances at the RBA from 0 to 10 basis points.

What are the implications and effectiveness of these policies during this period of volatility and uncertainty? What does the zero lower bound look like for Australia, and how long are we expected to remain there?

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More information

Statement from the RBA on their 18/03/20 meeting

“Taper Tantrum”

Guest

Benjamin Wong is a DECRA research fellow in the Department of Econometrics and Business Statistics at Monash University. Dr Wong was previously a research economist at the Reserve Bank of New Zealand from 2014 to 2018 and a Central Bank Research Fellow at the Bank for International Settlements. His main fields of research are applied macroeconometrics and time series analysis, with a focus on issues related to estimation, inference and interpretation of sources of business cycle fluctuations.

Hosts

Professor James Morley, The University of Sydney

Associate Professor Aarti Singh, The University of Sydney

Dr Christopher Gibbs, The University of Sydney

About the podcast

In this episode we explore the potential implications of the recent coronavirus (COVID-19) pandemic on the Australian economy.

What is the scale of the expected slowdown in economic activity, and is it more likely to look like a supply or demand-side shock? What can economic policymakers do to cushion against the impact of a global pandemic?

More broadly, how can policymakers respond to dynamic events without access to definitive forecasts or timely statistics?  What policy instruments are best utilised in different scenarios, or when monetary policy in particular might be constrained?

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More information

The business cycle: periodic pandemic or rollercoaster ride?

Is business cycle asymmetry intrinsic in industrialized economies?

State-dependent effects of fiscal policy

Will the economic recovery die of old age?

Inventory shocks and the Great Moderation

Guest

Our guest is Andy Neumeyer, professor of economics at the Universidad Torcuato Di Tella in Argentina. He served as the Chief Economist at the Central Bank of Argentina from February 2016 to June 2018. His main fields of research are macroeconomics, international finance and development.

Hosts
  • Professor Mariano Kulish, University of Sydney
  • Professor James Morley, University of Sydney
  • Dr Christopher Gibbs, University of Sydney
About the podcast

What lessons are to be learned from business cycles in emerging economics? How do economists play different roles as academics and policy makers? Professor Neumeyer discusses these topics and the challenges he faced as Chief Economist at the Central Bank of Argentina.

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Guest

Nigel McClung is a Research Economist in the Research Unit of the Bank of Finland. He was awarded a PhD in Economics at the University of Oregon in 2018, and joined the Bank of Finland in the same year. His main research interests include adaptive learning, monetary-fiscal policy interactions and non-linear DSGE models.

Hosts
  • Professor Mariano Kulish, Professor of Macroeconomics, University of Sydney
  • Dr Christopher Gibbs, Senior Lecturer, University of Sydney; Economic Research Advisor, Reserve Bank of Australia
  • Dr Ye Lu, Lecturer, University of Sydney
About the podcast

What should students know before applying for a PhD in economics? Do you have to get a PhD in the United States if your goal is to work in Australia? In this podcast, Nigel McClung, a recent PhD graduate and a research economist at the Bank of Finland, shares his experiences from applying for a PhD to navigating the job market and what it's like to work in the Bank of Finland. The speakers in this podcast, with their diverse backgrounds (three countries, varying levels of maths preparation before grad school, different research interests etc.) make for a rich and inspiring discussion relevant for students and young professionals alike.

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More information

Guest

Dr Galina Hale has been a Research Advisor at the Federal Reserve Bank of San Francisco since 2006. Prior to this she was an Assistant Professor in the Economics Department at Yale University. She received her PhD in economics in 2002 from the University of California, Berkeley. Dr Hale specialises in international finance, international banking, and capital flows. She is an Associate Editor of the Journal of International Economics.

Hosts
  • Professor Mariano Kulish, University of Sydney
  • Professor James Morley, University of Sydney
  • Dr Stella Huangfu, University of Sydney
About the podcast

What is the role of economic research in policy institutions? Having worked for the Federal Reserve Bank of San Francisco for more than 13 years, Galina Hale shares her insights into the cross-fertilisation between research and policy work. She discusses the use of economic research in the conduct of policy, having been at the Fed during the global financial crisis, the sources of the European sovereign debt crisis and the future of the euro, Brexit, and other issues at the nexus of macroeconomics and international finance.

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More information
Guest

Dr Junior Maih is a Senior Adviser at the Norges Bank and adjunct Associate Professor at the BI Norwegian Business School. His recent work has focused on DSGE models with regime switching. Aside from his research in macroeconomics, Dr Maih also regularly contributes to development of the modelling software Dynare.

Hosts
  • Professor Mariano Kulish, University of Sydney
  • Professor James Morley, University of Sydney
  • Dr Yunjong Eo, University of Sydney
About the podcast

How can we model for a change in the behaviour of economic agents over time? Dr Junior Maih discusses how the development of models with regime switching has the potential to assist our understanding of macroeconomics and improve forecasting over standard constant parameter models. He also outlines some of the modelling pitfalls researchers may face, and highlights the increasing importance of software as part of the economist's toolkit.

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More information
Guest

Gianni Amisano is Chief of the Current Macroeconomic Conditions Section of the Research and Statistics Division of the Board of Governors of the Federal Reserve System. He is also a senior fellow at the Rimini Centre for Economic Analysis.

Amisano's main research interests include Bayesian inferential techniques, financial time series models, structural VAR models, mixture models and their applications, econometric forecasting, time varying parameter models, panel data, and estimation of DSGE models.

Disclaimer: All views expressed by Gianni Amisano are his only and do not necessarily represent the views of the Federal Reserve System.

Hosts
  • Professor Mariano Kulish, Professor of Macroeconomics, University of Sydney
  • Professor James Morley, Professor of Macroeconomics, University of Sydney
  • Dr Christopher Gibbs, Senior Lecturer, University of Sydney; Economic Research Adviser, Reserve Bank of Australia
About the podcast

How do a machine and human intelligence differ when they make economic forecasts? What are the key strengths and weaknesses in the macroeconomic models the Fed uses today? Gianni Amisano, Chief of the Current Macroeconomic Conditions Section at the Federal Reserve Board, explains how the right balance between humans and machine depends on, among other things, whether we want point or density forecasts, the specific uncertainty we face, and how quickly we need to update our beliefs. He also offers insights into the usefulness of the "rational expectations" assumption and the merits of incorporating financial frictions into macroeconomic models.

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More information

Current Macroeconomic Conditions, Federal Reserve Bank, United States

Data and indicators, Federal Reserve Bank of New York.

Past events

Find out more about our activities.

Wednesday 31 July 2019

Eli Remolona is the former Regional Head for Asia of the Bank for International Settlements and current Visiting Professor at Williams College’s Center for Economic Development. He is the world-leading expert on how financial markets respond to information released by policymakers. His public lecture explores how to improve central bank communication.

Find out more.

Tuesday 8 October 2019

A public lecture by Dr Perry Warjiyo, Governor of Bank Indonesia, followed by a Q&A moderated by Dr Luci Ellis, Assistant Governor (Economic) at the Reserve Bank of Australia.

During the global financial crisis of 2008, several central banks, being aware of the conditions that new global economic conjuncture necessitated, decided to modify their existing monetary policy framework by enhancing other policies such as macroprudential policy, exchange rate policy, capital-flows management, fiscal policy coordination and structural adjustment stimulus. This policy is now called policy mix – its approach is preserving the main objective of achieving and maintaining price stability while safeguarding financial stability as a supporting objective.

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Contact us

Address
  • Faculty of Arts and Social Sciences The Quadrangle A14, the University of Sydney NSW 2006, AUSTRALIA

Co-director

Headshot of Professor James Morley
Professor James Morley
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Co-director

Headshot of Professor Mariano Kulish
Professor Mariano Kulish
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