Economics Explored

Dr Begoña Dominguez speaks with Economics Explored host Gene Tunny about her recent video on Financing the COVID-19 Government Debt.Begoña Dominguez is currently Associate Professor at the School of Economics, University of Queensland. Her research interests are in the area of macroeconomics and, more specifically, in the design of optimal fiscal and monetary policies. Her research has been published in top journals in economics, such as Journal of Monetary Economics and Journal of Economic Theory, among other outlets.In her video, Begoña outlines three thought provoking proposals to assist with financing the COVID-19 government debt, specifically:1. coordinated fiscal and monetary policies with a temporary lift in the inflation target, along the lines of what was suggested by Bianchi, Faccini, and Melosi (2020) Monetary and Fiscal Policies in Times of Large Debt: Unity is Strength2. social contract, whereby an evaluation is done after the pandemic is over to determine whether some groups were under or over-compensated, and that evaluation could guide future tax policies3. improving the efficiency of the tax system, to ensure that whatever revenue is raised is raised in the most efficient way possible. In the conversation, Begoña mentions that the US Federal Reserve has modified its inflation target during the pandemic. For further information, see: What does average inflation targeting mean for investors?

A conversation on whether COVID can be compared to wartime, which considers the different scales and scopes of the shocks, and what it all means for prospects for economic recovery. Economics Explored host Gene Tunny, an Australian professional economist and former Treasury official, speaks with businessman Tim Hughes, also based in Brisbane, Australia.Gene and Tim conclude that a comparison of COVID to wartime isn’t valid. One reason is that World War II required a complete reorganisation of the economy to maximise production for the war effort, while COVID has involved restrictions that have reduced economic activity. Links relevant to the conversation include:Comparing COVID-19 to past world war efforts is premature — and presumptuousUS Council on Foreign Relations Backgrounder on The National Debt DilemmaBrookings on What’s the Fed doing in response to the COVID-19 crisis? What more could it do?Australia’s Boldest Experiment (excellent book on Australia’s wartime economy)Robert Gordon’s The Rise and Fall of American Growth (outstanding book by a leading US economist containing a great discussion of America’s wartime economy)Aussies over-confident after being over-compensated by Gov’t for COVID-recessionMint security lapse amazes judge (story about theft from the Australian Mint in early-to-mid 2000s)Finally, the word Gene got stuck on at 6:55, irredentist, means, “a person advocating the restoration to their country of any territory formerly belonging to it”, according to Oxford Languages.If you'd like to ask a question for Gene to answer in a future episode or if you'd like to make a comment or suggestion, please get in touch via the website. Thanks for listening.

It’s been a challenging year 2020, but one positive development is that regulators in the US and Australia have started challenging the Big Tech companies Google and Facebook over alleged misuses of market power. Economics Explored host Gene Tunny provides an update and discusses the important economic concepts and policy issues.Links relevant to the conversation include:Joseph Stiglitz on Regulating Big TechDon't Be Evil: The case against big tech by Rana ForooharAustralian Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2020Economics Explored EP58: Tech Giants challenged by the Media and GovernmentsEconomics Explored EP22: Antitrust with Danielle Wood from the Grattan InstituteEconomics Explored EP21: Surveillance Capitalism with Darren Brady NelsonEconomics Explored EP16: Big Economic issues for the 2020s

Economics Explored host Gene Tunny chats about money and cryptocurrency, specifically Bitcoin, with Brisbane-based businessman Tim Hughes. They consider whether Bitcoin can replace traditional money in this new age of political unrest and this new paradigm of Modern Monetary Theory. Relevant links include:Naval Ravikant on Happiness, Reducing Anxiety, Crypto Stablecoins, and Crypto StrategyJohn Quiggin's 2018 post on Bitcoin's belated bustMoney: The True Story of a Made Up ThingMoney Mischief by Milton Friedman

A conversation regarding the emerging field of Behavioural Finance and its lessons for households, investors, and governments. Economics Explored host Gene Tunny speaks with Dr Tracey West, a Lecturer in the Griffith Business School. Links relevant to the conversation include:Tracey's Griffith University Experts pageTracey's LinkedIn profileTracey's academic publications via Google ScholarStorm Financial clients slam $140k fine after 3,000 investors left destitute

Economics Explored host Gene Tunny speaks with Adam Smith Institute Director Dr Eamonn Butler about the values and lessons of Adam Smith (the great Scottish philosopher and founder of economics), the depiction of Margaret Thatcher in Netflix's season 4 of The Crown, and price controls. Here's a link to the book on price controls Dr Butler co-authored:Forty Centuries of Wage and Price Controls: How Not to Fight Inflation

The COVID-19 pandemic has prompted the World Economic Forum to call for a Great Reset of the global economy. What is the Great Reset and should we be concerned? In this episode, Economics Explored host Gene Tunny discusses the Great Reset with Darren Brady Nelson, Chief Economist of LibertyWorks and a research fellow at the Heartland Institute.Links related to the conversation include:COVID-19: The Great ResetWhat is Davos?Forty Centuries of Wage and Price ControlsThe Great Reset is 'crazy, kooky stuff' which aims for 'no private property by 2030'

Multi-billion-dollar Megaprojects like Boston’s Big Dig and Brisbane’s Cross River Rail are more at risk of cost blowouts and failing to generate the benefits they expect than smaller infrastructure projects. Marion Terrill, Transport & Cities Program Director at the Grattan Institute, explains why in a conversation with Economics Explored host Gene Tunny. Marion has recently co-authored a Grattan Institute report The rise of megaprojects: counting the costs.Issues of discussion include:Why megaproject costs blow out (5:20)Optimism bias (12:00)What Nassim Nicholas Taleb wrote about megaprojects in Antifragile (17:15)How we can improve infrastructure project selection and management (22:50)

The Fourth Industrial Revolution, involving the convergence of the internet, AI, and blockchain, will radically change our economy and our lives, according to the authors of a new book published by Routledge. Economics Explored host Gene Tunny speaks with authors Nicholas Johnson, CEO of Economists Without Borders, and Dr Brendan Markey-Towler, and Associate of EWB.Where you can buy the book Economics of the Fourth Industrial Revolution: Internet, Artificial Intelligence and Blockchain:Book DepositoryAmazonRoutledgeLinks relevant to the conversation include:How should we measure the digital economy?Power LedgerBrooklyn MicrogridEOSIO

Economics Explored host Gene Tunny discusses the evidence on the impact of changes in minimum wages on the employment of low-skilled workers.Links relevant to the conversation include:David Neumark on the Employment effects of minimum wagesAustralian Productivity Commission Workplace Relations Inquiry ReportGlenn Loury and David Neumark video podcast discussion of minimum wagePaul Krugman opinion piece Liberals and WagesCard and Krueger's famous 1994 minimum wage study

Economics Explored host Gene Tunny discusses the natural rate of unemployment and the non-accelerating inflation rate of unemployment, the NAIRU. He considers whether they're the same thing, why they are important, and what affects them. Links relevant to the episode include:Milton Friedman's 1967-68 AEA Presidential Address on the role of monetary policyKansas City Fed paper on a new estimate of the natural rate of unemploymentRBA paper on Estimating the NAIRU and the Unemployment GapBrookings post on What is u*?Carl E. Walsh on The Natural Rate, NAIRU, and Monetary Policy

Around the world, the tech giants such as Google and Facebook are being challenged by traditional media and governments. This episode considers the pros and cons of a new proposal in Australia to improve the bargaining position of traditional media companies relative to the tech giants. Economics Explored host Gene Tunny discusses the issues with his Adept Economics colleagues Taylor-Rose Hull and Ben Scott.The discussion is based on the following article:Australian Government takes on digital giants Google and FacebookLinks relevant to the conversation include:US justice department sues Google over accusation of illegal monopolyUnited States v. Microsoft Corp.ACCC Draft news media bargaining codePizzagate conspiracy theory

Economics Explored host Gene Tunny speaks with Stephen Howell, Principal Adviser of Effective Governance, regarding the importance of good corporate governance to a well-functioning economy. They consider examples of how poor governance of companies has damaged economies in the past, and they discuss principles for good corporate governance. Corporate social responsibility is also discussed, beginning with a consideration of Milton Friedman’s doctrine that companies should be run solely in the interests of their shareholders. Links related to the discussion include:Directors at Work: A Practical Guide for BoardsRio Tinto blasted ancient Aboriginal caves for $135m of iron oreGovernance through a crisis

Quantitative Easing (QE), once considered unconventional monetary policy, is becoming a long-term strategy of central banks. Michael Knox, Chief Economist of Morgans, a major Australian wealth management firm, discusses his recent note on this issue with Economics Explored host Gene Tunny.Relevant links include:Michael Knox’s note QE as a long-term strategyBen Bernanke’s AEA Presidential Address on the New Tools of Monetary PolicyGuy Debelle’s speech on the Australian Economy and Monetary PolicyUS money supply (M2) data from FREDMoney supply growth chart for Australia from RBAA conversation with Professor Alan Blinder '67 and Chair Jerome Powell '75Robert Heller’s IMF paper on International Reserves, Money, and Global Inflation (from p. 28)

The Precautionary Principle is being used to justify the closure of state borders in Australia to deal with COVID-19. Should the Precautionary Principle, which many argue is relevant to climate change, be extended to COVID-19? Economics Explored host Gene Tunny discusses the Precautionary Principle and COVID-19 with Joe Branigan, Director of Tulipwood Economics.Links relevant to the conversation include:The precautionary principle should not be used as a basis for decision-makingJohn Quiggin on Complexity, Climate Change and the Precautionary PrincipleThe Cost-benefit RevolutionCOVID19: Getting Australia Safely Back to WorkCancer screening, heart attack and stroke presentations down in Victoria during coronavirus pandemicThe silent death toll of COVID-19 revealed: Huge 25 per cent jump in suicides each year

How cutting red tape and improving regulations could help economies recover from the COVID-crisis. Economics Explained host Gene Tunny speaks with University of Sydney Associate Professor Salvatore Babones about his paper, co-authored with Ben Scott, Rationalising Regulation, which is part of the Centre for Independent Studies Pandemic to Recovery Policy Papers series. The paper is available via the CIS website.

Australia is having a big debate about state border restrictions which have been implemented to stop the spread of coronavirus. A conversation with Joe Branigan of Tulipwood Economics on the economic and public policy issues involved. Joe Branigan of Tulipwood Economics. Joe is the co-author with Dr Henry Ergas of the Menzies Research Centre paper COVID19: Getting Australia Safely Back to Work.Items mentioned in our conversation include:The Triumvirate’s Stratagem cannot stand – guest post by Joe BraniganNick Behrens’s briefing on the state of Queensland's COVID-19 Fiscal and Economic Review

Host Gene Tunny and his Adept Economics colleague Ben Scott discuss how economics can help us develop sensible public policies on a diverse range of issues, including the environment, housing, and public health, among others.Links relevant to this episode include:Gene’s presentation to Public Policy Pitch participantsPresentation slidesUQES & PPES Adept Economics Policy Pitch Competition

Economics Explained host Gene Tunny chats with Brisbane-based businessman Tim Hughes about what economists do and why the world needs them. Relevant links include:Wired article on Google Chief Economist Dr Hal VarianBehavioural economics with Dr Brendan Markey-Towler

Economics Explained host Gene Tunny presents some of his preliminary views on what the New Normal post-COVID could be like. Links relevant to the conversation include:Will the Pandemic Push Knowledge Work into the Gig Economy?Some retailers are turning their shops into 'dark stores' as consumers turn to online shoppingHome delivery of ‘comfort food’ increasing during Melbourne’s COVID-19 lockdown Amazon sales soar as coronavirus-worried consumers shop from home, but costs risePwC on COVID-19: from health issue to economic crisisCybersecurity in the Age of CoronavirusWhy Uber, Lyft's future in California could be decided by voters

Economics Explained host Gene Tunny discusses the drivers of the gold price with Darren Brady Nelson, Chief Economist of LibertyWorks and a policy advisor at the Heartland Institute. Links related to the conversation include:Darren's Mises Institute article How Fear and Uncertainty Drives Demand for GoldSudden Media Infatuation With Keynes' "Barbaric Relic" - GoldKeynes vs Hayek rap battleMilton Friedman on the gold standard – Excerpt: The Man Who KnewHistorical gold price data at measuringworth.com

Discussion of Stephanie Kelton’s book The Deficit Myth, which is popularising Modern Monetary Theory, between Economics Explained host Gene Tunny and his colleague Ben Scott from Adept Economics. Resources mentioned in the discussion include:Reserve Bank of Australia Governor Philip Lowe’s speech COVID-19, the Labour Market and Public Sector Balance SheetsOlivier Blanchard’s paper Public Debt and Low Interest Rates

Professor Henry Ergas and Joe Branigan have just had a new paper published by the Menzies Research Centre, COVID19: Getting Australia Safely Back to Work. Economics Explained host Gene Tunny speaks with Joe Branigan, Director of Tulipwood Economics, about the paper.For a sample of Joe’s comments and a link to an interview with Professor Ergas, check out:Suppression preferred over more costly elimination strategy say Ergas & Branigan

Economics Explained host Gene Tunny speaks with Professor Rodney Strachan regarding his recent video on the Challenges of Forecasting in the COVID-19 Pandemic.Professor Rodney Strachan is Professor of Econometrics at the University of Queensland in Brisbane, Australia. Rodney received his PhD from Monash University in 2000. His research focuses on Bayesian analysis, econometric theory, and time series analysis. Rodney came to UQ from the Australian National University where he was a professor and the deputy head of the Research School of Economics.Links relevant to this episode include:Koop and Potter’s 2007 paper A Flexible Approach to Parametric Inference in Nonlinear Time Series Models (highly technical)Autoregressive (AR) modelDummy variablesThere were a few other technical concepts mentioned in this episode which I’ll aim to cover in future episodes.

Economics Explained host Gene Tunny speaks to Dr Boyd Blackwell on the use of economic techniques to value the environment. Boyd is Director of AquaEquis Economic Consulting and the President of the Australian and New Zealand Society of Ecological Economics. Links relevant to the discussion include:Deloitte Value of the Great Barrier Reef reportConversation article critiquing economic value estimate of GBRBoyd’s economic analysis of Australian coastal wastewater outfallsSome number is better than no number articleNSW biodiversity offset schemeTravel cost method

Economics Explained host Gene Tunny presents and elaborates on his opening remarks to the Queensland Parliamentary Inquiry on the state government’s economic response to COVID-19. The remarks are relevant to state or sub-national governments in countries other than Australia. Here are some relevant links:COVID19: Getting Australia Safely Back to Work (the new Menzies Research Centre paper from Dr Henry Ergas and Joe Branigan questioning the net benefits of lockdowns)The New Bradfield scheme proposes moving floodwaters from north to south, but its feasibility is in questionAustralian Government 2009 Updated Economic and Fiscal Outlook (re. expenditure growth fiscal rule)Opening remarks to Qld Parliamentary Inquiry on economic response to COVID-19Australian coverage of my upcoming Qld Parliamentary Inquiry appearanceQld Gov’t COVID-19 Adaption Grants program poorly designed

Economics Explained host Gene Tunny discusses dynamic pricing, which is used by Uber and airlines among other businesses, with his Adept Economics colleague Ben Scott. Resources mentioned in the conversation include:Tim Harford's The Next Fifty Things that Made the Modern EconomyUber and airline dynamic pricing models can be viewed as both fair and predatoryQPAC/QTIX to trial Uber-style surge pricing to boost revenueMatching and Dynamic Pricing in Ride-Hailing PlatformsHe has 17,700 Bottles of Hand Sanitizer and Nowhere to Sell ThemDynamic pricing: Retailers using artificial intelligence to predict top price you'll pay

Economics Explained Host Gene Tunny discusses unfreezing discount rates for infrastructure projects with Marion Terrill, Transport and Cities Program Director at the Grattan Institute, a leading Australian think tank. Marion is a leading policy analyst with experience that ranges from authoring parts of the 2010 Review of Australia’s Future Tax System to leading the design and development of the MyGov account. She has provided expert analysis and advice on labour market policy for the Australian Government, the Business Council of Australia and at the Australian national university. She joined the Grattan Institute in April 2015 to establish the Transport Program, and has published on investment in transport infrastructure, cost overruns, value capture, congestion, and discount rates.Here is a link to Marion’s 2018 report on discount rates co-authored with Hugh Batrouney:Unfreezing discount rates: transport infrastructure for tomorrowThe Resources for the Future Working Paper I quote from in my introductory remarks is Discounting for Public Cost–Benefit Analysis

Professor Tony Makin of Griffith University speaks about his new CIS Policy Paper A Fiscal Vaccine for COVID-19 with Economics Explained host Gene Tunny. In Tony’s words, “the paper considers the resurgence of crude Keynesianism before highlighting risks of the fiscal legacy.”Tony Makin is Professor of Economics at Griffith University and has previously taught at the University of Queensland, the Lee Kuan Yew School of Public Policy at the National University of Singapore and in the Australia and New Zealand School of Government (ANZSOG) program. His field of expertise is international macroeconomics and public finance and he has previously served as an economist with the International Monetary Fund and in the Australian federal departments of Finance, Foreign Affairs and Trade, The Treasury and Prime Minister and Cabinet. He has also been Director of the APEC Study Centre at Griffith University, and Australian convener of the structural issues group of the Pacific Economic Cooperation Council (PECC).Resources mentioned in the conversation include:Australia’s Competitiveness: Reversing the Slide by Tony MakinResponse to Professor Tony Makin’s Minerals Council of Australia Monograph – ‘Australia’s Competitiveness: Reversing the Slide’The Effectiveness of Federal Fiscal Policy: A ReviewTony Makin’s Agenda paper on fiscal stimulus during the GFCIS-LMentary by Paul KrugmanAustralian examples of Depression-era public works projects:Lamington National Park's historyMt Spec Road and Little Crystal Creek Bridge

Why is there a gender pay gap - i.e. why do women earn less than men on average? To what extent is it due to working in different types of jobs, levels of experience or education, or discrimination and biases? Economics Explained host Gene Tunny discusses the evidence with his colleague Benjamin Scott, Research Officer at Adept Economics. Resources mentioned in the discussion include:Blau and Kahn JEL article on the gender wage gapRoss Guest on the Real Gender Pay GapKPMG She's Price(d)less reportLeonora Risse on the gender pay gap interviewAndrew Leigh's video Underpaid & Over ItAustralian Government Workplace Gender Equality Agency on the gender pay gap

Economics Explained host Gene Tunny speaks about one of his favourite books, Stephen Covey's 7 Habits of Highly Effective People, with Tim Hughes, a Brisbane-based businessman (Urban Ergo). Gene speaks about how he sees the lessons applying to economists. A 30th anniversary edition of the 7 Habits was published this year.Links related to the discussion include:Art of Manliness episode on 30th anniversary of the 7 HabitsPaul Frijters on coronavirusWho pays Trump's tariffs, China or U.S. customers and companies?Ralph Turvey on how to estimate marginal costsBrian Tracy's Eat that FrogThe 7 habits of highly effective economists – Part 1: Habits 1 to 3 for private victoryThe 7 habits of highly effective economists Part 2 – Habits 4 to 7: Public victory & renewal habits

Economics Explained host Gene Tunny speaks with Craig Lawrence, Managing Director of Lytton Advisory, regarding the pros and cons of picking winners and interventionist industry policy more broadly.Craig Lawrence has over 30 years of experience across government and private sector projects, particularly in infrastructure, transport, and tourism. Prior to establishing Lytton Advisory, Craig was Director-Infrastructure Policy at the Queensland Government Department of State Development, Infrastructure and Planning where he led a team of policy and regulatory analysts and economists looking at infrastructure prioritisation and resource region supply chain optimisation. He was previously Director-Economic Policy within the Department.Reports mentioned in the conversation include:QCA Industry Assistance Review Report (see p. 25 for the footloose Berri Fruit Juice example) Productivity Commission Automotive Industry Modelling Report (see p. 80 for the PC’s estimate of the high cost per job saved Gene mentioned in the conversation)

Economics Explained host Gene Tunny speaks with statistician William M “Matt” Briggs about uncertainty and the perils of prediction.Matt is a consulting statistician and a policy advisor to the Heartland Institute. He has been a visiting Professor of Statistics at Central Michigan University and an Adjunct Professor of Statistics at the Cornell Medical School. Matt is the author of the 2016 book Uncertainty: The Soul of Modeling, Probability and Statistics, published by Springer.In the interview I mention Matt’s article Why is Economics plagued by Math? This article by Matt refers to a 2015 paper by Nobel Prize winning economist Paul Romer Mathiness in the theory of economic growth.If you’re interested in learning more about Matt’s work, check out this video on YouTube:The crisis of evidence, or why probability and statistics cannot discover causeIn my introductory remarks I quote from John Bohannon’s Science Magazine article: About 40% of economics experiments fail replication survey

Darren Brady Nelson speaks about his new Heartland Institute Policy Brief How to fix America's crumbling infrastructure: lessons from Australia with Economics Explained host Gene Tunny. Darren is an Austrian school economist who serves as the chief economist at LibertyWorks, an Australian think tank, and as an associate scholar with the US Center for Freedom and Prosperity. He is also a policy advisor to the Heartland Institute. Darren has previously worked for NSW Treasury, various consulting firms, industry associations, a US Presidential campaign, and for an Australian Senator. Use these (approximate) timestamps as a guide to the conversation:2:20 – Darren gives an overview of the US’s crumbling infrastructure7:15 – Darren observes “the average US airport…looks like something out of the Soviet Union”19:00 – Darren notes “the key is to actually open things up to competition as well, not just to privatize things or to recycle an asset”20:00 – discussion of National Competition Policy in Australia and how the Australian economic reform process slowed down in the 2000s28:10 – reference to Productivity Commission’s finding of substantial economic gains from National Competition Policy in Australia (e.g. see the 2005 Inquiry Report - Review of National Competition Policy Arrangements) and Darren argues the US can easily replicate Australia's very high ROI with a US National Competition Policy

Working from Home: Opportunities and Risks is a new briefing paper from Alison Pennington and Jim Stanford from the Centre for Future Work at the Australia Institute. Economics Explained host Gene Tunny interviews Alison regarding the paper in this episode. Alison Pennington is Senior Economist with the Centre for Future Work. Her research focus is on work in Australia today, and in the future. She received a Master of Political Economy from the University of Sydney. Her research focus was on the Australian finance system, housing and inequality. Her twitter handle is @ak_pennington.TimestampsUse these (approximate) timestamps to jump right to the highlights:5:40 – productivity impacts discussion8:30 – how social isolation can impair cognitive ability12:00 – discussion of the view expressed in the paper that “working from home will likely become more common in coming years. For millions of workers, indeed, it will become the ‘new normal.’”16:30 – how workplaces can adapt – an end to hot-desking, a return to pods, and staggered start times28:05 – discussion of employee surveillance by employers – 70% of employees subject to at least one type of digital surveillance and there is a risk this can extend into people’s homes if working from home becomes the new normal32:20 – reference to how the Australian Taxation Office (ATO) has tried to make working from home easier (check out the ATO page Working from home during COVID-19)

This episode is a review of the big issues covered in recent Economics Explained episodes on coronavirus. Economics Explained host Gene Tunny and Brisbane-based businessman Tim Hughes of Urban Ergo react to excerpts of recent episodes and discuss the important policy issues regarding coronavirus. TimestampsUse these (approximate) timestamps to jump right to the highlights:1:40 – radical uncertainty around coronavirus impacts, featuring an excerpt from EP33 with Prof. John Kay CBE11:40 – discussion of issues around re-opening economies and whether we’re “putting a price tag on human life”, featuring an excerpt from EP32 with Dr Dan Mitchell20:00 – discussion of Benno Torgler’s paper on certified corona-immunity (check out EP30 with Prof. Benno Torgler)24:10 – discussion of an excerpt of my conversation with Joe Branigan on how we pay for the coronavirus response (EP31 with Joe Branigan)30:10 – reference to the Quantity Theory of Money33:40 – discussion of Dr Dan Mitchell’s views on bailouts43:10 – discussion of Australia’s COVIDSafe appOther recent coronavirus-related episodes not yet mentioned include:EP28 with Dr Nicholas Gruen on coronavirus policy responsesEP27 with Michael Knox from Morgans on coronavirus, machine trading & financial markets

Radical Uncertainty: Decision making for an unknowable future is a new book from eminent British economists Professor John Kay CBE, FRSE, FBA, FAcSS and former Bank of England Governor Lord Mervyn King. Economics Explained host Gene Tunny interviews Professor Kay about the book in this episode. TimestampsUse these (approximate) timestamps to jump right to the highlights:2:34 – John Kay on what is meant by Radical Uncertainty, beginning with references to Maynard Keynes and Frank Knight8:40 – discussion of what Kay and King see as the critical question, “What is going on here?”, in the context of coronavirus14:35 – discussion of non-stationary process16:25 – discussion of the usefulness of economic models, with Gene asking John to explain the statement in the book “"You cannot derive a probability or a forecast or a policy recommendation from a model..."26:10 – John explains the importance of robustness and resilience in systems in response to a question referencing climate changeKay and King’s lessons on the appropriate use of economic models include:deploy simple models (as you’re trying to “illuminate part of the large world of radical uncertainty”, rather than trying to precisely describe it)identify the most important parameters and undertake research to determine sensible values of those parameters,simple models are more flexible, andunder radical uncertainty, options provided by a particular policy can be extremely important.It goes without saying that this book is highly recommended reading. This episode was recorded on Friday 24 April 2020 using Zoom.

Economics Explained host Gene Tunny speaks with Dr Dan Mitchell about government bailouts of companies such as airlines which we are seeing in this time of coronavirus. Dr Mitchell is the Founder of the Center for Freedom and Prosperity and a former Senior Fellow at the Cato Institute. He runs the highly informative and thought-provoking blog International Liberty.TimestampsUse these (approximate) timestamps to jump right to the highlights:1:05 – discussion of venture capitalist Chamath Palihapitiya’s view that companies should go bankrupt rather than being bailed out (check out Government should let airlines fail)5:15 – an ostensible libertarian justification for bailouts, the concept of regulatory taking (check out Dan’s post Protecting Airlines and Other Companies from Government Control)7:40 – we need to ensure there isn’t a permanent expansion of government when it’s all over10:00 – discussion of merits of different ways of bailing out companies, after Gene quotes from a Guardian article US government agrees on $25bn bailout for airlines as pandemic halts travel11:50 – “There are no good options” according to Dan17:00 – is the coronavirus crisis an indictment of capitalism? No, says Dan. Check out Dan’s post Coronavirus and the Tradeoff Between Big Government and Competent Government19:10 – to what extent is US situation a failure of the federal government versus state governments? Dan thinks the states are best placed to deal with coronavirus25:10 – discussion of what Dan thinks are misplaced concerns about stock buybacks (check out Dan’s post Washington’s Counterproductive Attack on Stock Buybacks)32:05 – discussion of Dan’s Venn diagram in his post Coronavirus, Economics, and Saving Lives34:05 – reference to UN report which acknowledges economic cost of coronavirus containment measures (check out this NPR article U.N. Agency Fears ‘Vulnerable’ Africa May Suffer At Least 300,000 COVID-19 Deaths)This episode was recorded early on the morning of Saturday 18 April 2020 (Australian Eastern Standard Time) via Zoom.

Social distancing measures to contain coronavirus have crashed economies around the world, reducing government tax revenues. At the same time, governments have brought in massive economic rescue packages to support workers and businesses. An obvious question is: where is the money coming from to pay for these rescue packages and to make up for the lost tax revenue? Economics Explained host Gene Tunny explores this question with Joe Branigan, Director of Tulipwood Economics. TimestampsUse these timestamps to help you jump right to the highlights:5:45 - Gene recalls his time in the Australian Treasury's Budget Policy Division where he dealt with debt policy and cash management issues7:15 - discussion of how governments borrow money by selling bonds12:20 - discussion of bond auctions/tenders by the Australian Office of Financial Management (AOFM)17:30 - who buys bonds? (for Australian info, check out the excellent AOFM article The Australian Government Securities investor base)20:00 - discussion of Bank of England direct financing of UK Gov't spending (discussed in a pay-walled article in the Financial Times, Bank of England to directly finance UK government's extra spending), monetisation of deficits, and Modern Monetary Theory29:20 - repaying versus refinancing/refunding the debt31:10 - long-term problems/risks with government debt37:30 - overview of Joe's research on costs and benefits of coronavirus policy measures

Economics Explained host Gene Tunny speaks with Professor Benno Torgler of QUT about a new paper he has co-authored: Certified Corona-Immunity as a Resource and Strategy to Cope with Pandemic Costs.Professor Benno Torgler is Professor of Economics in the School of Economics and Finance and Centre for Behavioural Economics, Society and Technology (BEST), QUT. He was also Adjunct Professor at the EBS Universität für Wirtschaft und Recht, Germany (2012-2015) and an ARC Future Fellow (2011-2015).TimestampsUse these (approximate) timestamps to jump right to the highlights:1:20 – abstract/overview of Benno’s paper – immune people must be identified and re-integrated into normal activities as soon as possible5:15 – reference to Gene’s interview with CCIQ Chief Economist Marcus Smith on the economic impacts of coronavirus5:40 – concept of Immunity Certificates8:50 – what does Benno mean by actively producing the resource of corona-immunity?11:55 – importance of widespread testing and the need to discuss trade-offs (e.g. public health and economy), prompting discussion of final sentence of abstract, “There is a risk that the impacts of the secondary crisis could outweigh that of the biological event from a health and societal perspective.”13:40 – discussion of Frank Snowden’s book Epidemics and Society: From the Black Death to the Present16:40 – reference to post-September 11 study which showed driving deaths increased following terrorist attack which led to less air travel by Gerd Gigerenzer, Out of the Frying Pan into the Fire: Behavioral Reactions to Terrorist Attacks21:00 – reference to Paul Frijters’ articles on the virus - e.g. The Corona Dilemma23:45 – Benno mentions Rizio and Skali paper on How often do dictators have positive economic effects?

Economics Explained host Gene Tunny discusses coronavirus policy responses with Joe Branigan, Director, Tulipwood Economics. The episode features a discussion of what we're learning from around the world, including from experiences in Australia, NZ, Italy, and the US, among other countries.Use these timestamps to help you jump to the highlights:1:50 - Joe reviews international data on coronavirus cases as at 1 April5:00 - how case fatality rates depend on the testing regime7:30 - why Italy has been so badly affected compared with Australia11:05 - what is a Disability Adjusted Life Year (DALY)?13:00 - discussion of whether cost-benefit analysis is relevant in assessing coronavirus responses20:50 - Sweden identified as a country which appears willing to tolerate a worse public health outcome to avoid enacting draconian measures23:20 - discussion of pros and cons of a full lock-down strategy30:20 - "No one knows what the right answer is" - recognition we have much to learn from the variety of responses and experiences around the world32:00 - major takeaway is that each country is on its own trajectory and policy responses need to be specific to each country

Would strong early action on coronavirus have been better, from both public health and economic perspectives, than the incremental policy responses we have seen in countries such as Australia and the US? In this episode, Economics Explained host Gene Tunny discusses policy responses to coronavirus with Dr Nicholas Gruen, CEO of Lateral Economics. Nicholas is a Visiting Professor at King’s College, London, and former Chair of several government, non-profit, and private sector organisations, including Innovation Australia and Kaggle.TimestampsUse these (approximate) timestamps to jump right to the highlights:4:00 – Nicholas discusses his recent article on coronavirus policy PANIC IS OUR FRIEND! which argues in favour of strong, early action on coronavirus, rather than the incremental ramping up of restrictions we have seen7:50 – Nicholas notes these decisions are challenging because panic itself has costs, as argued by Paul Frijters in his article The Corona Dilemma12:30 – discussion of John Quiggin’s Option value post on the benefits of early action 14:05 – Nicholas suggests policy makers should follow Google’s example and experiment and AB test policy responses, generating feedback to improve policies 15:05 – discussion of what Ben Shapiro calls The Un-askable Question26:35 – Nicholas observes “when things change they become highly unpredictable” in our discussion of what coronavirus could mean for our future economic system36:00 – conclusion of discussion with a quote from Nicholas’s article: “Right now, panic is the friend of anyone who doesn’t want to get this disease, which continues to surprise on the downside (i.e. the bad side).”

Why are financial markets swinging so wildly in response to the novel coronavirus, COVID-19? Economics Explained host Gene Tunny speaks with Michael Knox, Chief Economist of Morgans, who thinks it's related to the machine trading programs which dominate financial markets.Morgans is Australia's largest national full-service stockbroking and wealth management network with more than 240,000 client accounts, 500 authorised representatives and 950 employees operating from offices in all states and territories.TimestampsUse these (approximate) timestamps to jump right to the highlights:0:00 – discussion begins with Gene referring to Michael’s recent note The revenge of the machines which begins “The market is being sold down by machine trading programs focused on momentum.” 4:00 – Michael says recent market gyrations have “nothing to do with fundamentals….we're in a situation because of the epidemic, because of the emergency that only happened once every hundred years or every 50 years - you can't build a model of something like that. So inherently, what those trading models are acting on is the momentum signal…”7:00 – beginning of discussion on market liquidity11:00 – Michael discusses the relationships between liquidity, price discovery, and market volatility 15:10 – Michael notes re. COVID-19, “On this occasion, you had a change, which was caused by a once in 50 years shock or once in 100 years shock. The market doesn't have that kind of memory of data to be able to price that in.”16:15 – discussion of valuation of shares/stocks18:15 – what is momentum?24:20 – discussion of fair value of Australian sharemarket and Australian economic outlookNothing in this podcast should be considered financial advice, and it contains general information only.

A lot of the infrastructure assets relevant to our daily lives, such as roads, bridges, and parks, are provided by city or municipal governments. In this episode, we ask the question: how should we assess the economic viability of city infrastructure projects? To answer this question, we’ve invited Craig Lawrence, Managing Director of Lytton Advisory, back on to the program. Lytton Advisory is an Australian professional services firm specialising in infrastructure economics and decision making.*Use these (approximate) timestamps to jump right to the highlights:1:00 – conversation starts with host Gene Tunny asking Craig about a recent post (A $7 Crossing) he wrote about the economic viability of Brisbane City Council’s proposed $190 million Kangaroo Point to Brisbane City pedestrian bridge12:00 – discussion of external benefits (or externalities) and wider economic benefits relevant in assessment of city infrastructure projects18:00 – discussion of agglomeration effects and benefits of active transport23:30 – Craig delivers his assessment of the economic viability of the Brisbane City to Kangaroo Point pedestrian bridge – “at the moment, there's not enough evidence on the benefit side, to be able to justify the project “26:00 – further discussion of wider economic benefits – Craig notes a rule of thumb is that they should only be 15-20% on top of private benefits32:00 – Gene commences conversation with Craig about Brisbane City Council’s un-costed redevelopment of Victoria Park Golf Course into a public park and how one might assess its economic viability43:20 – beginning of discussion on Cross River Rail, a controversial new subway system in Brisbane which was originally costed at $5 billion but may end up costing $12 billion, a mega project which Craig has previously been sceptical about (Cross River Rail Dice Roll?) *Economics Explained host Gene Tunny is currently working with Craig as a Senior Associate with Lytton Advisory on projects in the Middle East and Australia.

In an Australian ABC News story in early February, Deloitte Access Economics Partner Nicki Hutley referred to the potential cost of climate change as “astronomical”. In this episode, Economics Explained host Gene Tunny chats with Nicki about the cost of action compared with the cost of inaction on climate change. Use these (approximate) timestamps to jump right to the highlights:1:10 – Nicki describes why the costs of unmitigated climate change would be "astronomical"4:40 – reference to Deloitte report for Australian Business Roundtable finding cost of extreme weather events in Australia will be $40 billion per year by 20508:00 – further discussion of cost of inaction, including a reference to Deloitte’s report on the value of the Great Barrier Reef10:30 – what needs to be done to avert catastrophic climate change (i.e. need to transition away from using fossil fuels) and the distinction between mitigation and adaptation15:20 – current international agreements/measures won’t reduce emissions enough16:00 – discussion of the inadequacy of Australian state government aspirational targets for renewable energy in the absence of a carbon price/emissions trading scheme or carbon tax21:00 – Nicki argues that, due to the lack of a carbon price, we are not encouraging sufficient investment in renewables or in R&D – reference to blue and green hydrogen (check out Woodside’s website for information)22:50 – Gene mentions Brian Fisher’s controversial estimate of the cost of the Australian Opposition’s climate change plan of $500 billion and asks Nicki about the cost of acting versus not acting, with Nicki noting the cost of inaction would be many multiples of the cost of action25:40 – discussion of implications of transition away from fossil fuels for coal miners, etc.27:40 – costs of renewable energy vs coal

Bloggers such as Mr Money Mustache and the Financial Samurai have been responsible for starting a new movement: the FIRE movement. FIRE stands for Financial Independence Retire Early. By early, proponents typically mean retiring in your 30s or 40s. To discuss the FIRE movement, Economics Explained host Gene Tunny has invited Griffith University Business School lecturer Dr Di Johnson back on to the program. Di is a member of the Australian Securities and Investments Commission’s Financial Capability Research Network. In addition to teaching and researching, Di is a regular commentator on financial issues on ABC radio and TV here in Brisbane, Australia.TimestampsUse these timestamps to jump right to the highlights:1:40 – Dr Di provides an overview of the FIRE movement (also check out this Forbes article The 9 FIRE blogs you should read) 3:45 – is the FIRE movement a millennial idea? 7:35 – doing the math, you can see some big risks with the FIRE concept (Di mentions some information on average spending by singles and couples that was once on ASIC’s MoneySmart website: Weekly spend by life stage)11.20 – challenge of forecasting future living costs in decades to come – e.g. think about trying to forecast current Sydney cost of housing back in the 1970s16:40 – Di says some positives of the FIRE movement are it encourages people to save when they’re young and it promotes conscious consumerism23:05 – what is Barista FIRE?25:35 – discussion of digital nomads and vagabonding30:05 – Di notes it may be preferable to just find ways to make your current work more enjoyable – e.g. the slow work movement, taking longer holidays, etc. The episode was recorded via Zoom video conferencing on the 25th of February 2020.

Many universities now offer courses in entrepreneurship, as students have been inspired by tech entrepreneurs such as Elon Musk and Mark Zuckerberg. But what exactly is entrepreneurship and who qualifies as an entrepreneur? Is entrepreneurship essential for economic growth? To help answer these questions, Economics Explained host Gene Tunny invited Professor Peter G. Klein on to the program. Peter is W. W. Caruth Chair and Professor of Entrepreneurship at Baylor University in Texas. He is also Carl Menger Research Fellow at the Mises Institute. TimestampsUse these timestamps to jump right to the highlights:2:25 – what is entrepreneurship? Entrepreneurship as a mindset 6:50 – Was Donald Trump an entrepreneur?15:50 – Schumpeter’s theory of creative destruction19:20 – Peter’s Entrepreneurial Judgment model (check out Peter’s book co-authored with Nikolai J. Foss Organizing Entrepreneurial Judgment and Peter’s Murray N. Rothbard lecture The Present State of Entrepreneurship Research on YouTube)26:15 – Gene mentions Cal Newport’s point that Steve Jobs thought the big value add of the iPhone was you could have your phone and iPod in the one device and didn’t foresee just how important all the apps would be (check out Newport’s great book Digital Minimalism) 35:15 – discussion of best places to be an entrepreneur, in which Peter tells Gene that Australia may not be as bad as he thinks, and Austin, Texas is attracting people who are leaving Silicon Valley39:05 – Peter says entrepreneurs are “absolutely front and centre in the process of economic growth” 44:15 – Peter refers to "the allure of fine tuning the economy" regarding frequent tweaks to R&D tax incentives The episode was recorded via Zoom video conferencing on the 12th of February 2020.

The massive market power of the big tech companies, such as Google, Facebook, and Amazon, has prompted a renewed interest in antitrust laws. To help us understand antitrust, we’ve invited Danielle Wood from the Grattan Institute on to Economics Explained. The Grattan Institute is a leading Australian public policy think tank based in Melbourne. Danielle is Budget Policy and Institutional Reform Program Director at Grattan. Later this year, she will take up the CEO position at the Institute. Danielle is well qualified to talk about antitrust, having once worked as Principal Economist and Mergers Director at the ACCC, the Australian Competition and Consumer Commission.Check out Danielle’s 2019 Inside Story article The hipster trustbusters.TimestampsUse these timestamps to jump right to the highlights:1:45 – what is antitrust? 5:40 – the hipster trustbusters8:58 – the problem with Amazon12:20 – the Chicago school view on antitrust17:28 – the data the tech companies have on us and network effects as barriers to entry19:45 – Grattan’s analysis of market concentration in Australia25:05 – problem isn’t market power per se, but the abuse of it26:15 – discussion of US Department of Justice-Microsoft case31:10 – should we break up big tech companies?33:29 – ACCC has been good at pushing for new powers, but it hasn’t been successful in mergers cases in the courts in the last 20 yearsThe episode was recorded via Zoom video conferencing on the 10th of February 2020.

So-called surveillance capitalism was one of the big issues for the 2020s identified in the first Economics Explained episode this year. Google, Facebook, and other tech giants have massive amounts of data on us and they are using it for commercial gain. In this episode, Economics Explained host Gene Tunny discusses various perspectives on surveillance capitalism with his good friend Darren Brady Nelson, Chief Economist of LibertyWorks, an Australian libertarian think tank.Darren’s recently had an article published on the Mises Institute website with the title Surveillance Capitalism: A summary of critics. This is Darren’s second appearance on Economics Explained, and we spoke via Zoom video conferencing on the 18th of January 2020.Use these timestamps to jump right to the highlights:4:45 – Darren argues some criticism of surveillance capitalism is simply the latest manifestation of opposition to capitalism in general11:40 – Darren mentions work by Austrian economist George Gilder who thinks current tech giants are “going over the hill” (according to this Forbes article) and companies to watch will be in blockchain and quantum computing25:55 – Darren mentions section 230 of the US Communications Decency Act, often referred to as “The Twenty-Six Words That Created the Internet”27:30 – discussion of how it’s monarchs or governments which have traditionally created monopolies – e.g. British East India Company42.30 – mention of recent laws affecting tech companies – EU GDPR (e.g. see this Wired article) and California Consumer Privacy Act (for info, check out this Guardian article)

Australian economist and federal Member of Parliament Dr Andrew Leigh is interviewed about his new book with co-author Professor Joshua Gans Innovation + Equality: How to Create a Future that is More Star Trek than Terminator, published by MIT Press in 2019. This wide-ranging conversation covers a range of issues, including labour market impacts of digital disruption, universal basic income, and how to improve teacher effectiveness, among other issues.Use these timestamps to jump right to the highlights:4:20 – impact of AI and automation on jobs9:50 – criticisms of Universal Basic Income – fiscal critique and the fact work brings meaning – in which Andrew mentions Blanchflower and Oswald study Wellbeing over time in Britain and the USA11:05 – Andrew advises young people not to over-specialise15:20 – innovation is generally good for the economy and society, so Andrew rejects Bill Gates’s robot tax idea (see this Business Insider article)19.05 – Gene asks Andrew about Nicholas Gruen’s idea about public private partnerships for digital public goods (e.g. listen to Economics Explained episode 7)24:00 – Andrew tells us how we can connect with him, including by listening to his Good Life podcast24:40 – discussion of how to improve teach effectiveness, in which Gene asks about teachers’ unions and performance-based/teacher merit pay; check out Andrew’s 2012 paper The economics and politics of teacher merit pay (NB Gene mangled the end of his question, but Andrew got the gist of it, thankfully)28:45 – Andrew proposes assessing teacher quality policy measures via Randomised Controlled Trials (RCTs) This episode was recorded on 20 January 2020 via Skype.