Research success

Recent selected grant success

Australian Research Council

Neuroeconomic foundations of probability and value perception

ARC Discovery Grant 2019

Years: 2019-2023

Investigators: Professor Agnieszka Tymula (University of Sydney) and Professor Paul Glimcher (New York University)

This project aims to investigate well-known behavioural “biases” in probability and value perception through the lens of neurobiology. This project will generate new knowledge on human behaviour by combining theory and methodology from economics and neuroscience. Through its interdisciplinary approach, this project will provide a novel and braincompatible understanding of how people make decisions. This should deliver significant and tangible benefits by providing foundations for the “second wave” in behavioural economics, which builds upon the work of Kahneman and Tversky not just behaviourally, but also neurobiologically.

Fiscal Policy in an Open Economy

ARC Discovery Grant 2019

Years: 2019-2023

Investigators: Professor Mariano Kulish (University of Sydney), Professor James Morley (University of Sydney) and Associate Professor Francesco Zanetti (University of Oxford)

This project aims to improve our understanding of the impact of commodity price changes. Over the past two decades, Australia has experienced unprecedented fluctuations in commodity prices. The fiscal position and potential of the economy depends on the extent to which commodity price changes are temporary or permanent. The project will uncover empirical regularities between commodity prices, unemployment across sectors and measures of fiscal policy. The project will build structural models of unemployment which will be estimated and used to assess implications for unemployment and budget deficits of commodity price shocks and to study the optimal design of fiscal policy. The project will benefit the conduct of economic policy in Australia.

Intergenerational Disadvantage: Causes, Pathways, and Consequences

ARC Linkage Project 2019

Years: 2020-2023

Investigators: Professor Deborah Cobb-Clark (University of Sydney), Dr Hayley Fisher (University of Sydney), Dr Nicolas Salamanca (University of Melbourne), Dr Sarah Dahmann (University of Sydney), Dr Susan Kluth (Department of Social Services), Dr Kai Liu (University of Cambridge) and Dr Anne Gielen (Erasmus University Rotterdam)

This project aims to prevent poor Australian children from becoming poor adults by developing scientific evidence and creative policy approaches to overcome entrenched disadvantage. The Project will generate new knowledge on how social assistance dependence is linked across generations using new Australian data. Expected outcomes are the identification of i) the causal link between parents’ and children’s social assistance dependence; ii) the pathways through which youths overcome disadvantage; and iii) the role of family structure in transmitting disadvantage. Transforming the evidence base, the findings will have significant benefits in redesigning the Australian social safety net, promoting social and economic mobility.

NHMRC Targeted Call for Research: into Indigenous Social and Emotional Wellbeing

Against the odds: Understanding the factors influencing wellbeing among Indigenous youth in the Northern Territory

Years: 2018-2023

Investigators: Professor Stefanie Schurer (University of Sydney), Dr Peter Shaw (University of Sydney), Miss Tanja Hirvonen, Mrs Olga Havnen, Professor Pat Dudgeon (University of Western Australia), Professor Lisa Cameron (University of Melbourne) and Professor Stephen Guthridge (Menzies School of Health Research)

This mixed-methods project studies the factors that influence social and emotional wellbeing (SEWB) of Indigenous youth in the Northern Territory. It uses administrative data and econometric techniques to identify communities where youth have higher or lower SEWB than expected. These locations are then visited to ask Indigenous youth about their perspective on SEWB (giving them a voice). Research-to-practice translation will focus on cultural safety, respect and benefits for Indigenous youth.

Australia’s National Research Organisation for Women’s Safety

Analysis of linked longitudinal administrative data on child protection involvement for NSW families with domestic and family violence drug and alcohol use and mental health issues

ANROWS Core Grant Research Program 2020-2022

Years: 2021-2022

Investigators: Associate Professor Amy Conley Wright (University of Sydney), Professor Stefanie Schurer (University of Sydney), Dr Betty Luu (University of Sydney), Dr Sue Heward-Belle (University of Sydney), Dr Susan Collings (University of Sydney), Dr Emma Barrett (University of Sydney) in partnership with Human Services Data Set Governance Advisory Committee and FACS Insights, Analysis and Research (FACSIAR).

Domestic and family violence (DFV), alcohol and other drug use (AOD) and serious mental health issues (MHI) are considered key parental behavioural risk factors to children’s safety. What is less well understood is to what degree they intersect and interact with each other (Humphreys et al., 2018). This project builds upon previous ANROWSfunded research. The Safe & Together Addressing ComplexitY for Children (STACY for Children) project considered how DFV, AOD and MHI related to children’s pathways through child protection in Queensland, but was limited by short time periods and absence of linked data. No population-level analysis currently exists on the interdependence of DFV, AOD, and MHI with child protection involvement for Australia’s most populous state (NSW). Their Futures Matter Human Services Dataset (HSDS) contains linked administrative data on children born or living in NSW since 1990 (n = all) and family members, with 7 million records representing over 60 datasets from 11 government agencies, over a 27-year period. The aim of this research is to produce population statistics to strengthen the evidence base for children and young people impacted by intersecting risk factors of DFV, AOD and MHI. The analysis will focus on rural or geographically remote areas, where service planning is most challenging.

Australian Centre for International Agricultural Research (ACIAR)

Inclusive Agricultural Value Chain Financing

Years: 2018-2022

Investigators: Dr. Alan de Brauw (International Food Policy Research Institute (IFPRI)), Dr Russell Toth (University of Sydney), Kate Ambler (International Food Policy Research Institute), Dr Sahat Pasaribu (Indonesian Center for Agriculture Socioeconomic and Policy Studies (ICASEPS)), Kwin Pwint Oo (Myanmar Economic Association), Truong Thi Thu Trang (Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD))

The project aims to increase knowledge about how to design and implement innovative and inclusive agricultural value chain financing models in South East Asia.

Spencer Foundation

The Long-term Effects of Conditional Cash Transfer Programs on Human Capital: What has been Accomplished Over the Last Two Decades?

Small Grant Request

Years: 2020-2021

Investigators: Dr Valentina Duque (University of Sydney)

Cash transfers have become an increasingly popular anti-poverty tool in the developing world and have spread throughout more than 80 low- and middle-income countries. Yet there exists limited evidence on their long-term human capital impacts and little is known on whether and how CCTs are achieving their ultimate goal of breaking the intergenerational transmission of poverty. The goal of this project is to study the educational and economic outcomes of the program’s earliest beneficiaries, who were either in childhood or in primary school when the program began, and who are now entering the labor market. Using the universe of participants in Colombia’s CCT program, Familias en Accion, linked to a myriad of admin records (the universe of students in public schools, test scores data, tertiary education and labor data, and future welfare participation), the empirical strategy estimates a regression discontinuity design (RDD) that exploits the eligibility rule for Familias en Accion given by the SISBEN poverty index score. We will also explore the impacts of timing of exposure to CCTs and type of investments. Our findings will highlight the importance of considering the long-run and multigenerational benefits of cash transfer programs when evaluating their costs and benefits.

Centre for Retirement Research at Boston College - Steven H. Sandell Grant

The Influence of Early-life Economic Shocks on Long-term Outcomes: Evidence from the U.S. Great Depression

Year: 2018

Investigators: Dr Valentina Duque (University of Sydney) and Dr Lauren Schmitz (University of Wisconsin-Madison)

How does health and economic productivity around retirement age and up to old age vary with early-life economic conditions? While previous research has shown that prenatal events can have consequences on outcomes in adulthood, there is a dearth of empirical evidence examining whether initial environments can influence human capital at later stages of the lifecycle. Using geographic variation in economic conditions from the most severe and prolonged economic downturn in American history—the Great Depression—combined with restricted micro-data from the Health and Retirement Study, this proposal will study the effects of economic downturns at birth on labor market outcomes, cardiovascular health, and physical mobility at older ages. From a policy perspective, our results are informative for the design of retirement and healthcare systems and for assessing the cost of business cycles.

DVCR: University of Sydney Research Accelerator Prize (SOAR)

Sydney Research Accelerator (SOAR) Program Sydney Research Accelerator (SOAR) program acknowledges and supports outstanding up-and-coming early and mid-career researchers through a two-year scheme. SOAR Fellows will receive funding for their research, a personalised program of research development support and structured mentoring. SOAR helps researchers to build their leadership skills, establish connections with partner organisations and nurture our researchers in formulating their innovation and development plans.

Seasonal poverty, rural labor market and migration, and formation of non-cognitive skills in children

Years: 2020-2021

Chief investigator: Associate Professor Shyamal Chowdhury

Associate Professor Chowdhury’s SOAR prize focuses on two of current research projects: i) the functioning of rural labour markets in developing countries, and ii) the formation of non-cognitive skills in children. The twin objectives of the two research projects are: first, to produce cutting edge research outputs publishable in high-ranked generalinterest journals in economics, and second, to find evidence-based interventions that address both immediate poverty and hunger, as well as the long-term disadvantages that poor parents and their children face.

Project 1: Seasonal poverty, rural labour markets and migration

Project 2: Towards a better understanding of the non-cognitive skills in children: malleability, sensitive periods, typical trajectories, and transmission within the family

Health, Retirement and Ageing

Years: 2020-2021

Chief Investigator: Dr Kadir Atalay

Dr Atalay’s current research focuses on the individual- and system-level economic concerns of ageing, such as personal behaviour toward pensions, retirement and household savings, and the macroeconomics of population ageing. This research agenda is of crucial policy relevance because over the next 30 years, a quarter of Australia’s population is expected to be older than 65. The effects of this profound societal change will be borne by older people, their families and communities, and the agencies that support them. Dr Atalay’s research agenda aims to shed light on the economic consequences of this change. Dr Atalay has examined the effect of social security reforms on labour-supply decisions of individuals and couples, effects on consumption plans, and the wellbeing of individuals. Since 2015, this line of research has been funded by an ARC Discovery Project grant. The SOAR fellowship allows Dr Atalay to expand on this research agenda by examining the health consequences of these reforms, using administrative (clinical) data on drug prescriptions, hospitalization and mortality. The key innovation of this project is to use clinical data by focusing on long-term health conditions. Previous studies in the literature focuses on the immediate impacts of retirement and selfreported health conditions, hence they do not provide any assessment of the link between retirement and diseases that appear later in life (such as Dementia, Alzheimer). This will be the first study in the literature that examines these issues using administrative data. The funding from SOAR allows Dr Atalay to begin working on administrative data, ‘45 and Up Study’- the largest ongoing ageing data in the Southern Hemisphere.

Office of Global Engagement Partnership Collaboration Awards - University of Sydney

The impacts of high-skill return migrants on firms in China

Years: 2019-2020

Investigators: Dr Russell Toth (University of Sydney) and Associate Professor Yifan Zhang (CUHK)

One of the core questions in economics is to explain persistent differences in cross-country income. The relatively mobile factors of labour and capital explain less than half of the gap, leaving open the door to less tangible factors like managerial knowledge, technical expertise, and social networks. We seek to pull together a number of data sources on the career histories of elite Chinese workers who obtained school and/or work experience overseas in advanced countries such as the United States, Germany, or Australia, and then returned as so-called “sea turtles” (haigui). We leverage province-by-year variation in the implementation of policies to incentivize sea turtle return, combined with sub-sectoral variation in economic trends in the manufacturing and mining sectors, to study impacts on sub-sectoral productivity. Data on worker flows allows us to further obtain intensive-margin estimates of impacts, and uncover underlying mechanisms.

Evaluation of environmental effectiveness and economic efficiency of incentive based instruments for pollution control in China and Australia

Years: 2019-2020

Investigators: Associate Professor Tiho Ancev (University of Sydney), Dr Alastair Fraser (University of Sydney), Associate Professor Yuan Xu (CUHK) and Associate Professor Yan Xu (CUHK)

Australia has used incentive based-mechanisms, such as environmental taxation and tradable permit schemes for nearly two decades. Examples are the NSW Load Based Licensing and the Hunter River Salinity Trading Scheme. China has run seven pilot tradable permit programs for reducing C02 emissions since 2013 and started implementing environmental taxation for other air and water pollutants in 2018. In December, 2017 China announced a national CO2 emission trading market, initially targeting the electricity generation sector. This study will preliminarily assess the Chinese environmental taxation mechanism based on the experiences from Australia. A comparative evaluation will be conducted on the economic efficiency and effectiveness of tradable permit schemes in China and Australia. The findings will identify areas where the design of these incentive-based instruments could be improved, and will propose ways to implement those improvements in both countries.

Research grant feature

Valentina Duque writes about her research on inequality and the effectiveness of conditional cash-transfers.

I am a health and development economist. I received my PhD from Columbia University in 2015 and then worked as a Postdoctoral scholar at the University of Michigan. I arrived at the School of Economics at the University of Sydney in 2018.

My work is motivated by the idea that inequality starts early in life and that children in low-income households are more likely to grow up to be low-income themselves. In my research I study two related topics: i ) the pathways through which disadvantaged families’ greater exposure to adverse conditions (poverty, violence, unemployment) translate into poorer health, education, and income for their children (and their future children), and ii), how policies that target children since their young ages help reduce long-term disadvantage.

One of the questions that I am particularly interested in, is understanding the role that income plays in changing this intergenerational correlation. Coming from a developing country myself where wealth and income inequality is one of the highest in the world, in Colombia the role of government (conditional) cash transfers -one of its main safety net programs -, is widely regarded to be a major support for the ultra-poor. Despite this, there is actually very little research exploring whether the program has been successful at breaking the intergenerational transmission of poverty.

Conditional cash transfers (CCTs) are a popular policy aimed at reducing current and future poverty. By giving poor parents money conditional on that their children receive medical check-ups, good nutrition, and attend school, research has shown that these programs have been successful at improving short-term educational outcomes. As of today, more than 60 low- and middle-income countries operate a CCT program, hence, analysing the effects of these massive investments is imperative.

To explore the effects of CCTs on young adults’ outcomes two decades after the program started, my colleagues and I have leveraged Colombia’s CCT program. We combine multiple sources of data on both program participants and a potential control group, which enables us to reconstruct the entire life-course trajectories of millions of children and their families.

We measure the effects of CCTs using the fact that, some families were eligible for the program and some were not, based on their income, which in turn allows us to compare the outcomes of children in families just below and just above the income cut-off. Economists love these Regression Discontinuity comparisons because they mimic an actual experiment!

Our preliminary findings suggest that CCTs are associated with significant increases in high school completion, higher achievement test scores by age 18, and with a higher probability of pursuing tertiary education. What is more exciting is that the earlier that a child receives the benefit, the larger the effect!

Our next step is to estimate models on labour market, fertility, and migration. At the moment, we are very excited that our project has received generous funding from the Spencer Foundation!