Facts & figures
Experimental Economics studies the economic behaviour of individuals in a controlled laboratory or field setting. Economic experiments range from indiviudal decision making to complex, multi-agent markets. Experimentalists aim to stress-test economic theory. The fact that most traditional models turned out to have little predicitive power in the laboratory, led some economists to update those models with more psychologically plausible assumptions, giving birth to what is nowadays known as Behavioural Economics. This is accomplished by making non-standard assumptions about human preferences, exploring non-standard beliefs, and emphasising the limitations of human decision-making abilities. The predictions of Behavioural Economics are continously scrutinised in experiments, resulting on the further refinenments or refutals of the theory. Behavioural predictions about individual behaviour are seen as somehow more accurate and thus starting to guide some government policy.
Behavioural and experimental economists at Sydney have extensive expertise in a variety of topics that include market design, experimental methodology, risky decision-making, self-control, impulsivity, strategic decision-making, cooperation, and biological basis of preferences (neuroeconomics).
Development economics is the field of economics concerned with promoting the growth and development of countries that are considered economically less developed. Development economics is a data-driven field, often involving collecting new data (e.g., surveys), and creative analyses of secondary and “big data,” to test theories of economic development. Development economists often partner with practitioners from the private and public sector to evaluate development programs and contribute to development policy. Development economists at the University of Sydney conduct impactful research on issues including agriculture, the environment, human capital (education and health), micro, small, and medium enterprises, migration, technology adoption, and the role of psychology in economic development. They do so through research projects in the Asia-Pacific region (e.g., Bangladesh, Fiji, Indonesia, Myanmar, Papua New Guinea, Vietnam), and the broader developing world (e.g., Colombia, Ethiopia, Kenya, Mexico, Uganda). Development economists at the University of Sydney are passionate about bringing this experience to the classroom, and in providing opportunities for research students to engage in cutting-edge research in development economics. Experts include:
Econometrics is the analysis of economic data. It is achieved using statistical modeling and inference informed by economic theory. Econometricians develop and improve statistical procedures used to guide business decisions and public policy, and to test the predictions of economic theory. Recent research by our faculty has contributed to a range of topics in econometrics, including the analysis of high-frequency economic and financial data, the study of anomalies in the prices of financial derivatives, and the comparison of income distributions. Experts include:
Economic history is the study of the passed economic phenomenon, concerned with the historical economic development of human society. As a modern discipline, economic history is predominantly concerned with studying the economic development of nations since the advent of capitalism in the eighteenth century as well as the development of the global economy. The discipline provides an important input to the economics discipline as whole in gauging the explanatory power of its theories with reference to the reality of social, political and policy making institutions.
The history of economic thought is by contrast concerned with studying the historical evolution of economic ideas which shapes the form of economics as a social science today. A major focus of study is on the development of economic theory by influential economists such as Adam Smith, David Ricardo, Alfred Marshall and John Maynard Keynes, to name but a few, to understand how they formulated their ideas, to identify and assess the nature of their contribution and the nature of their influence on the discipline as well as economic policymaking. The history of economic thought provides a critically based understanding of economic ideas which is a necessary requirement to intellectual progress in economic science itself.
Financial economics is the field of economics that deals with understanding how financial instruments are priced in markets and how individuals and firms manage financial risk. Areas of study include capital markets, financial institutions, corporate finance, and corporate governance. Topics often revolve around asset valuation of individual stocks, bonds, derivatives, currencies, and other financial instruments. The subfield of financial econometrics focusses on applying statistical methods to financial market data. Experts in this field include:
Industrial organisation is the field of economics that studies the strategic interaction of market participants, with a particular focus on the determinants and outcomes of firm behaviour. Researchers in the field address questions such as: what determines the prices charged by firms in a market, the number of firms that operate in that market, the set of products firms offer, the nature of advertising, investment and research and development in that market; and what is the impact of these decisions on the welfare of consumers? Our faculty have particular expertise in examining: the determinants and impact of the internal organisation of a firm; the dynamics of pricing and investment decisions; the determinants of the intensity of competition (or the existence of cooperation) between firms; and the incentives for firms to educate or confuse consumers.
Labour, health and education economics are fields of micro-economics that examine how individuals make decisions about how to allocate their time towards improving their well-being over the course of their life. Labour economists focus specifically on decisions about work and factors that affect whether and how much to work, including how government policies such as welfare payments change those incentives. Health economists examine policies that impact health as well as economic issues that arise in markets for health care. Education economists are interested the decision to invest in human capital – who undertakes education, why and what benefits do they accumulate over their lifetime? These three fields often have significant overlap, with health, work and education being tightly intertwined in an individual’s life. Our faculty have a particular focus on examining how income and health, both mental and physical, evolve from childhood into retirement. Experts include:
Macroeconomics is the study of aggregate phenomena in the economy, including business cycles, inflation, and long-run growth in standards of living. Our macroeconomists conduct theoretical and empirical analysis to better understand the economic mechanisms driving these phenomena and the role of policy in shaping outcomes for individuals and society more broadly. Recent research focusses on using micro-founded models and a mixture of aggregate and household or firm level data to examine how behavioural decisions and expectations formation influence the effectiveness of monetary and fiscal policies. But our macroeconomic research more broadly encompasses the development of empirical methods and theories to account for dynamics and take an open-economy perspective that is appropriate for the Australian economy.
Microeconomic theory studies individual and firm behaviour with rigorous mathematical models. It helps us predict how economic agents act and find the optimal ways to organize economic and social activities. The results are tested and applied in other fields such as macroeconomics, applied microeconomics, and experimental economics. In recent years, microeconomic theorists explore the boundaries of the field by studying restrictions and frictions in modern society and loosening the standard rational agent assumptions. At the University of Sydney, our expertise lies in mechanism design, theoretical industrial organization, information economics, and decision theory. Experts include:
Public economics studies the efficiency and equity effects of taxation and government spending programs. Key questions in the study of taxation policy include the optimal degree of tax progressivity, the optimal design of consumption taxes, deterrence of tax evasion and the effect of corporate taxation on investment and firm location. The study of spending programs covers topics including the design of unemployment insurance, retirement incomes policy, and the provision of public goods. The field makes use of empirical methods and theoretical models. Recent research makes use of large administrative data sets, such as income tax records, to study topics such as inequality and mobility. Experts in this field include:
Facts & figures
Our research is supported by numerous grants and our faculty consistently publishes in leading journals.