In conjunction with the Australian Transport Research Forum

ACE 08

About ACE 08
Program Overview
Keynote Speakers
The Forum Day
Social Functions
General Information
Contact Details

Gold Coast, QLD

Travelling the Gold Coast
Hire a Car
Train and Coach Travel
Air Travel

User Area

Registration, Submission
Committee Administration

Invited Speakers

- Gary Banks
- Chairman of the Productivity
- Commission
- (Productivity Commission)

- Kathryn Dominguez

- Professor of Public Policy and
- Economics
- (Federal Treasury)

- Ian MacFarlane
- Former RBA Governor 
- (Goldman Sachs)

- Charles Perrings
- Professor of Environmental
- Economics
- (UQ)

- John Quiggin
- Head of RSMG
- (UQ)

- Adonis Yatchew
- Editor ‘The Energy Journal’
- (courtesy QUT)

- Joshua Gans
- Professor of Management
- (Information Economics)
- (University of Melbourne)

Major Sponsors


Reserve Bank of Australia

Queensland Government

Queensland University of Technology

Goldman Sachs

The University of Queensland

Griffith University

Australian Government

Productivity Commission

Other Sponsors

The International Review of Economics Education






The Economic Society of Australia warmly welcomes you to the Gold Coast, Queensland, Australia for the 37th Australian Conference of Economists.
The Society was formed 83 years ago in 1925. At the time, the Society was opposed to declarations of policy and instead focused on open discussions and encouraging economic debate. Nothing has changed today, with the Society and the conference being at the forefront of encouraging debate.
This year we have a large number of papers dealing with Infrastructure, Central Banking and Trade.
Matters of the greatest global importance invariably boil down to be economic problems. Recent times have seen an explosion of infrastructure spending, after world-wide population growth has seen demand outpace aging supply. The world has become more globalised than at any time since World War I but the benefits of this (and the impact on our climate) has been questioned by some.
At the time of preparing for this conference we could not have known that it would have been held during the largest credit crisis since the Great Depression. The general public and politicians both look to central banks for the answers.
We are also very pleased to see a wide selection of papers ranging from applied economics to welfare economics. An A – Z of economics (well, almost).
Another feature of this conference is that we have gone out of our way to bring together economists from all walks of life, in particular from academia, government and the private sector. We are grateful to all of our sponsors, who are as diverse as the speakers.

Unless we have specifically been requested to do otherwise, all the papers presented at the conference are published in the proceedings in full. A small number of papers will have versions that have also been made available for special editions of Journals, Economic Analysis and Policy, and the Economic Record. Authors will retain the right to seek additional publication for papers presented at the conference so long as it differs in some meaningful way from those published here.
The opinions expressed in the papers included in the proceedings are those of the author(s) and no responsibility can be accepted by the Economic Society of Australia Inc, Economic Society of Australia (Queensland) Inc, the publisher for any damages resulting from usage or dissemination of this work.

Proceedings of the 37th Australian Conference of Economists

Papers delivered at ACE08
ISBN 978-0-9591806-4-0

Published November 2008
© Economic Society of Australia (Queensland) Inc
GPO Box 1170
Brisbane 4001
Queensland Australia

All the abstracts from the papers are available in a separate document. Please download this document to use as a reference for the published papers.
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Ackland, Robert, Steve Dowricky and Benoit Freyensz:
Measuring Global Poverty: Why PPP Methods Matter.
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Alam, Khorshed:
An Economic Analysis of the Public-Private-Community Partnership: The Case of Solid Waste Management.
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Alam, Khorshed and Md Shahiduzzaman:
Inflation and food security: Some emerging issues in developing countries.
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Anbarci, Nejat and Jungmin Lee:
Discretionary Behavior and Racial Bias in Issuing Traffic Tickets: Theory and Evidence.
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Anderson, Kym, James Giesecke and Ernesto Valenzuela:
Distorted Agricultural Incentives and Australian Economic Development.
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Bandara, Jayatilleke S:
Trade Liberalisation and Poverty: The South Asian Experience
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Bashar, Omar H.M.N.:
Does Monetary Policy Matter in a Less Developed Economy? Evidence from Bangladesh.
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Basov, Suren:
Monopolistic screening with boundedly rational consumers.
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Bateman, Hazel and Amandha Ganegoda:
Australia’s disappearing market for life annuities.
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Bianchi, Robert:
The Search For Hedge Fund Alpha.
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Blacklow, Paul and Aaron Nicholas:
Assessing graduate employment in the presence of endogeneity and sample selection bias.
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Blackwell, Boyd:
The economics of ocean outfalls and wastewater in Australia: Some empirical evidence on a dog’s breakfast.
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Bloch, Harry and Benjamin K. Agbenyegah:
Growth and Productivity in Australia.
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Brokaw, Alan J., Patrick Joyce and Thomas E. Merz:
Stuck in the Middle: An Experimental Study on Sharing a Strategic Advantage in a Binary Choice Game.
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Cabalu, Helen and Chassty Manuhutu:
Vulnerability of Natural Gas Supply in the Asian Gas Market.
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Caia, Lixin and Amy Y.C. Liub:
Public-Private Wage Gap in Australia: Variation along the Distribution.
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Cardak, Buly A., and Roger K. Wilkins:
The Determinants of Household Risky Asset Holdings: Background Risk and Other Factors.
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Carne, Kerry:
The four E’s: education, earnings, experience and externalities.
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Cheng, I-Hui, Ying-Yi Tsai and Leonard F.S. Wang:
R&D, Strategic Delegation and Market Share Competition.
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Chiswick, Barry R. and Paul W. Miller:
The “negative” assimilation of immigrants: A special case.
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Chowdhury, Shyamal and Futoshi Yamauchi:
Has Decentralization in Indonesia Led to Elite Capture or Reflection of Majority Preference?
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Chowdhury, Khorshed:
Balassa-Samuelson Effect Approaching Fifty Years: Is it Retiring Early in Australia?
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Clarke, Harry:
Adaptation Investments to Offset the Effects of Climate Change.
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Coate, Bronwyn:
Who Benefits from the Growing Market for Indigenous Art? Evidence of Indigenous Differences and Creative Achievement in Australia.
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Coccia, Mario:
What is the optimal rate of public and private R&D investment to maximize productivity growth?
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Coleman, William:
Gauging Economic Performance under Changing Terms of Trade: Real Gross Domestic Income or Real Gross Domestic Product ?
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Connolly, Greg:
Is the Trailing Inflationary Expectations Coefficient Less than One in Australia?
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Cooray, Arusha:
The financial sector and economic growth?
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Crase, Lin, and Sue O’Keefe:
The Paradox of National Water Savings.
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Crettez, Bertrand and R´egis Deloche:
An Economic Analysis of the Aldo Moro Kidnapping and Assassination.
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Deng, Xin, and Zhong Qin:
Ownership Structure, Performance and Determinants of Share Diffusion in Family Businesses: Evidence from China.
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Dharmaratna, Dinusha:
Price Responsiveness of Residential Water Demand in Sri Lanka.
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Dickenson-Jones, Giles, and Albert Wijeweera:
An Empirical Analysis of Price and Income Elasticities of Papua New Guinea’s Exports.
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Dijkstra, Bouwe R. and Anuj J. Mathewa:
Liberalizing Trade in Environmental Goods.
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Donald, Bruce:
Emerging patterns of Australia’s linkages with East Asia: a place in production networks?
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Doucouliagos, Chris:
Theory Competition and Selectivity Are All Economic Facts Greatly Exaggerated?
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Dreger, Christian and Jürgen Wolters:
M3 money demand and excess liquidity in the euro area.
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Dulleck, Uwe, Franz Hackl, Bernhard Weiss and Rudolf Winter-Ebmer:
Behavior of Online Shoppers.
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Earl, Peter E. and Tim Wakeley:
Student constructed learning and the potential for cognitive dissonance in the teaching of perfect competition.
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Engelbrecht, Hans-Jürgen:
Happiness and the Sustainable Wealth of Nations.
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Espinosa, Miguel, Pietro Bonaldi and Hernãn Vallejo:
Representations and identities for homogeneous technologies.
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Fry, Tim R.L., Linda Grahlmann, Tristan Masters and Campbell Aitken:
Motivations of home-grown tobacco (chop-chop) smokers.
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Gammon, Marie:
Women at Work - 1966, 1985, 2008. What Has Changed?
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Gan, Quan and Robert J. Hill:
Measuring Housing Aordability: Looking Beyond the Median.
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Haidar, Imad, Heping Panb, and Siddhivinayak Kulkarni:
Analysis of the Relation Between Crude Oil Futures Prices and Spot Price Using Nonlinear Artificial Neural Networks.
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Harding, Ann, Quoc Ngu Vu, Robert Tanton and Yogi Vidyattama:
Improving work incentives for mothers: the national and geographic impact of liberalising the Family Tax Benefit income test.
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Harrison, Robin and Samanthala Hettihewa:
The impact of macroeconomic variable and demographic structure on share prices - The case of New Zealand.
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Hettihewa, Samanthala and Christopher S. Wright:
Globalization, demography, history and the Australian investor.
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Hickson, Hayley Bree and Alfred Michael Dockery:
Is ignorance bliss? Exploring the links between education, expectations and happiness.
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Higgs, Helen:
Modeling Price and Volatility Relationships in the Australian Wholesale Spot Electricity Markets Using Constant and Dynamic Conditional Correlation Multivariate GARCH Models.
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Hirschberg, Joe and Jenny Lye:
A Geometric Comparison of the Delta and Fieller Confidence Intervals.
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Hodgkinson, Ann and Alisa Percy:
Exploring student engagement for Generation Y: a pilot in Environmental Economics.
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Hodgkinson, Ann and Abbas Valadkhani:
Community valuations of environmental quality in coastal lakes: Lake Illawarra case study.
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Huynh, Elisabeth:
Portfolio Allocation and the Endogeneity of Wealth in Australian Households.
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Innes, James:
Assessing the efficiency of impact reducing management measures in fisheries.
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Islam, Asadul and Mark N. Harris:
Medium and Long-term Participation in Micro…finance: An Evaluation Using a Large Panel Data Set from Bangladesh.
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Islam, Asadul:
Child labour and schooling responses to access to access to microcredit in rural Bangladesh.
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Jensen, Paul and Beth Webster:
What Creates Abnormal Profits: Collusion, Efficiency or Strategy?
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Kamalakanthan, Abhaya and Sukhan Jackson:
Supply Imbalance of Doctors in Australia: A Qualitative Analysis of the Retention and Recruitment of Rural GPs.
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Kates, Steven and Alex Millmow:
The ‘History Wars’: The Near Death Experience of the History of Economic Thought in Australia.
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Kauzi, Gae and Thomas Sampson:
Is the kina a commodity currency?
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Khanam, R. and R. Ross:
Child Work and Other Determinants of School Attendance and School Attainment in Bangladeshi.
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Kifle, Temesgen and Dr Parvinder Kler:
The Determinants of Financial Satisfaction: Evidence from African Immigrants in Australia.
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Kim, Jae H., Iain Fraser and Rob J. Hyndman:
Improved Interval Estimation of Long Run Response from a Dynamic Linear Model: A Highest Density Region Approach.
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Kim, Jae H. and Philip Inyeob Ji:
An Empirical Analysis of the Mean-Reversion Property of Real Interest Rates.
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Kónya, László:
Panel Data Evidence of Human Development Convergence from 1975 to 2005.
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Kremmer, Michael L. and Duc-Tho Nguyen:
The Differential Impact of Policy Intervention on Fatalities among Drivers and Non-Driving Road Users in Queensland, 1989-2006.
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Lahiri, Radhika, and Elizabeth W. Richardson:
Public and Private Expenditures on Health in the Presence of Inequality and Endogenous Mortality: A Political Economy Perspective.
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Lahiri, Radhika and Shyama Ratnasiri:
Growth Patterns and Wealth Inequality in the Presence of Costly Technology Adoption.
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Lu, Xinsheng and Francis In:
The impact of monetary policy: The high frequency responses of Australian financial futures to cash rate target announcements.
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Lye, Jenny and Joe Hirschberg:
A Re-evaluation of the Relationship between Drinking and Earnings.
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Ma, Le and Chunlu Liu:
Estimating impacts of consumer prices on house prices.
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Madsen, Jakob B.:
Human Capital and Growth.
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Mahony, Greg and Philip E. T. Lewis:
Emerging Challenges for the Export of Australian Educational Services.
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Mahuteau, Stephane and Massimiliano Tani:
Labour market success and skill acquisition in the host country:
effects on the duration and the labour force status of Moroccans, Algerians, and Tunisians migrants returning home from the European Union.

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Makin, Anthony and Paresh Narayan:
Has international trade in saving improved US economic welfare?
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Martin, Will and Cong S. Pham:
Estimating the Gravity Model When Zero Trade Flows Are Frequent.
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McKenzie, Jordi:
Underlying Seasonality in the Presence of Increasing Returns to Information: Empirical Evidence from the Australian Motion Picture Industry.
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McKissack, Adam, Jennifer Chang, Robert Ewing and Jyoti Rahman:
Structural effects of a sustained rise in the terms of trade. Treasury Working Paper.
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Mehrara, Mohsen, Seyed Mohammad Hossein Sadr, Mahdi Ahrari and Atefeh Shahabadi Farahani:
The Effects Of Globalization On Non-Oil Export Of Iran.
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Mendolia, Silvia, and Denise Doiron:
The impact of job loss on family dissolution.
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Mervin, Merehau Cindy and Sukhan Jackson:
Is there a significant relationship between hospital resources and long waiting time for elective surgery in Australian public hospitals?
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Messinis, George:
Overeducation, overskilling and second generation Australians.
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Miranti, Riyana, Ann Harding, Vu Quoc Ngu, Justine McNamara and Robert Tanton:
Children with Jobless Parents: National and Small Area Trends for Australia in the Past Decade.
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Mischa, Florian, Norman Gemmella and Richard Knelle:
Business Perceptions, Fiscal Policy and Growth.

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Mistry, Mitesh, Andrew Worthington, Dionigi Gerace and Chandra Gulati:
The impact of trading-restricted, business days and trading, non-business days on Australian small-cap, large-cap and market returns.
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Mubarak, Adnan:
Role of foreign assistance in economic development of Pakistan.
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Muenthaisong, Kasinee, and Unggoon:
WongtragoonCommercial farming and Contract Farmers in Thailand.
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Nahar, Bodrun and Mahinda Siriwardana:
Analyzing the Impact of Trade Reforms on Bangladesh Economy: A CGE Approach.
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Neri, Frank and Yumiko Meloche:
Attendance and Performance in a Large Economics Class.
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O’Donnell, Rod:
Monetary and fiscal policy inconsistency in Australia and its wider implications.
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O’Donnell, Rod:
Why aren’t economics departments providing graduates with desired skill sets?
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Parasnis, Jaai and Svetlana Maslyuk:
The Determinants of New Zealand Migration: Comparing Migration to and from Australia and the United Kingdom.
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Pelli, Martino:
Oil Shocks and the Great Moderation: Different Sources, Different Effects.
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Qin, Zhong and Guibin Zhang:
Models of Trust-Sharing in Chinese Private Enterprises.
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Rahman, Mohammad Mafizur:
Australian Housing Market: Causes and Effects of Rising Price.
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Rastogi, Siddhartha K.:
A Cross-Country Study for Exploring Skewed Female - Male Ratio.
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Resosudarmo, Budy P. and Frank Jotzo:
Decomposing CO2 emission from fossil fuel combustions in Indonesia to understand the options for mitigation.
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Rodgers Joan R. and John L. Rodgers:
Contributions of Longitudinal Data to Poverty Measurement in Australia.
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Rushdi, Mustabshira and Jae H. Kim:
Long run relationship between real stock return and inflation in Australia.
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Sadr, Seyed Mohammad Hossein, Mohsen Mehrara, Atefeh Shahabadi Farahani:
Threshold effects in the relationship between oil revenues and growth in oil exporting countries.
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Sakho-Jimbira, Maam Suwadu, and Céline Bignebat:
Local diversification of income sources versus migration: Complements or Substitutes? A case study from rural Senegal.
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Sane, Renuka and John Piggott:
Does age-pension means testing cause over consumption of housing?: evidence from Australia.
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Sato, Kiyotaka, Zhaoyong Zhang and David Allen:
The Suitability of a Monetary Union in East Asia: What does the Cointegration Approach Tell?
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Shapiro, Perry and Jonathan Pincus:
Efficiency and Equity in the Assemblage of Land for Public Use: The L2H2 Auction.
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Sikdar, Shiva and Harvey E. Lapan:
Strategic environmental policy under free trade with transboundary pollution.
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Siminski, Peter:
What Would the Average Public Sector Employee be Paid in the Private Sector?
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Singh Sarjit:
The Dynamics of Australian Poverty Persistence.
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Stewart Mark F., Heather Mitchell, Constantino Stavros:
Does the AFL draft under value indigeneous Australian footballers?
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Sugaharaay, Kota, Zhiwei Cena, and Junko Doi:
Are they keeping up with Tokyo?: an empirical analysis of consumption externalities between regions of Japan.
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Susamto, Akhmad Akbar:
Government expenditure size and happiness: Empirical evidence.
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Suzuki, Tomoya:
Age, Wage and Suicide: Economic Modelling of Suicide.
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Swift, Robyn:
How Much Do Improvements in Health Contribute to Economic Growth: Long-run Evidence from the OECD Countries.
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Tang, Xueli and Debasis Bandyopadhyay:
Redistributive Policies and TFP Differences Across Countries.
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Tang, Tommy and Tim Robinson:
Development of the “Economic Thinking Ability” Construct and its Applications in Economics Education.
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Tang, Tommy and Tim Robinson:
Perceptions of Assessment Demands in Economics – Implications for Economics Education Research.
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Tawadros, George B.:
Is the GCC also a common currency area?
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Taylor, Matt and Nick Carroll:
Explaining the decline in Unemployment Benefit numbers in Australia: The role of Registration, Exit and Re-entry.
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Thomas, Mathew and Craig Lawrence:
Real options: Applications in public economics.
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Torgler, Benno, Markus Schaffner, Bruno S. Frey, and Sascha L. Schmidt:
Looking Awkward When Winning and Foolish When Losing: Inequity Aversion and Performance in the Field.
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Tsafack, Esther:
International trade and the French demand for labour.
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Valadkhani, Abbas, Surachai Chancharat and Charles Harvie:
Identifying the Pattern of International Stock Return Co-movements.
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Verma, R. and E. J. Wilson:
A Multivariate Analysis of Savings, Investment, Foreign Capital - Inflows and Economic Growth in India.
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Verma, Reetu and Nelson Perera:
An empirical analysis of sustainability of trade deficit: Evidence from south Asian countries.
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Vurens van Es, Robert and Alfred Michael Dockery:
Indigenous Australians in the Labour Market: Exploring the Role of Social Capital.
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Wei, Hui:
Measuring Economic Returns to Post-school Education in Australia: Evidence from the 1981- 2006
Australian Censuses

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Wen, Mei:
Internet Diffusion in Australia.
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Whitwell, Richard B:
A Note on the Need for Transparency in the Application of Anti-Dumping Duties.
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Wilson, Clevo and Wasantha Athukorala:
Groundwater Extraction Externalities: Accounting for Quantity Depletion and Quality Deterioration Simultaneously.
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Wilson, Clevo, Clem Tisdell and Wasantha Athukorala:
Nature-Based Tourism In Lesser Known Species And Their Implications For Conservation.
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Wilson, E. J:
A Critique of Modelling and Estimating the Effects of Consistent Conditional Variance Expectations on Exchange Rates.
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Worthington, A.C.:
Modelling the usage and understanding of financial products: An empirical analysis of Australian owner-occupied and investor mortgages.
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Xu, Jessica, Richard Harris and Peter Robertson:
Education Reforms in China: The Implications of Rapid Skill Accumulation.
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Yan, Yong Hong and Graeme Wells:
Modelling asset market dynamics under a fixed exchange rate and an application to the Chinese economy.
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Yokoo, Hide-Fumi:
Recycling versus Landfilling: A Cost Minimization Approach to Municipal Waste Management.
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Yu, Peng:
Is There a Causal Relationship between Parental Income Support Receipt and Child Mortality? An Analysis of a Cohort of Australian Children.
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Zaidi, Mohd Azlan Shah:
Monetary Policy and the Role of Credit in Malaysia: A SVAR Analysis.
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Zhu, Xiaoneng:
What Does the Global Yield Curve Tell about World Economic Activity?
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