AUT School of Economics

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https://hdl.handle.net/10292/10766
The AUT School of Economics has an established record and an on-going commitment to excellent research, high-quality supervision, and community and professional engagement. Members of the School sit on editorial boards and serve as referees for professional journals. The school has particular research strength in; Micro and macroeconomics, Econometrics, Industrial organisation, International trade and finance, Natural resource and environmental economics, Labour economics, Economic development, Health economics, and Public policy.

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Browsing AUT School of Economics by Title

Now showing 1 - 20 of 46
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    A literature review on the effects of living wage policies
    (Auckland Council, 2013-07-01) Maloney, TJ
    No abstract.
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    A typology of service supply chain strategies - pathways between agility and efficiency
    (Australia New Zealand Academy of Management (ANZAM), 2012) Wood, LC; Reefke, H; Breidbach, CF
    Various service supply chain strategies may provide firms with competitive advantage, providing appropriate pathways between different configurations are identified. Using a case study and a theory building process, we illustrate a configuration and movement in a typology of service supply chains. We explain how the framework aids analysis of current and future positions and the strategic implications for service supply chains. A key principle of the framework is the distinction between novelty, or frequency, of mismatches between information-as-input and service requirements, and the analysability of the challenge, or the level of difficulty in identifying and acquiring appropriate input information.
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    Big Data and Happiness
    (Global Labor Organization, 2020-09-02) Rossouw, S; Greyling, T
    The pursuit of happiness. What does that mean? Perhaps a more prominent question to ask is, 'how does one know whether people have succeeded in their pursuit'? Survey data, thus far, has served us well in determining where people see themselves on their journey. However, in an everchanging world, one needs high-frequency data instead of data released with significant time-lags. High-frequency data, which stems from Big Data, allows policymakers access to virtually real-time information that can assist in effective decision-making to increase the quality of life for all. Additionally, Big Data collected from, for example, social media platforms give researchers unprecedented insight into human behaviour, allowing significant future predictive powers.
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    Binary choice probabilities on mixture sets
    (The Centre for Mathematical Social Sciences (CMSS), the University of Auckland, 2014-12-09) Ryan, M
    No abstract.
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    Binary choice probabilities on mixture sets
    (School of Computer and Mathematical Sciences, Auckland University of Technology, 2014-11-28) Ryan, M
    Experimental evidence suggests that choice behaviour has a stochastic element. Much of this evidence is based on studying choices between lotteries – choice under risk. Binary choice probabilities admit a strong utility representation (SUR) if there is a utility function such that the probability of choosing option A over option B is a strictly increasing function of the utility difference between A and B. Debreu (1958) obtained a simple set of sufficient conditions on binary choice probabilities for the existence of a SUR. More recently, Dagsvik (2008) considered binary choices between lotteries and provided axiomatic foundations for a SUR in which the underlying utility function is linear (i.e., conforms with expected utility). Our paper strengthens and generalises Dagsvik’s result. We show that one of Dagsvik’s axioms can be weakened, and we extend his analysis to encompass choices between uncertain prospects, as well as various non-linear specifications of utility.
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    Can India plug into Asian international production networks through RTAs?
    (Murdoch University, 2013) Sen, R; Srivastava, S; Badri Narayanan, G
    Recent literature has focused attention on the important question of whether the current trend of proliferation of bilateral and regional trade agreements can facilitate creation and development of international production networks (IPNs) among member countries. However, majority of these adopt a partial equilibrium approach, thus ignoring the economy wide impact. As India gets increasingly integrated through calibrated globalization of its economy over the past two decades and creates a web of such trade agreements, this paper attempts to specifically analyze the effect of recent RTAs involving India on its ability to plug into IPNs in Asia by changing international trade and production patterns. The auto-parts industry, identified as one of the high-growth sectors for India’s manufacturing sector, with a potential to integrate into existing Asian IPNs, is chosen for this analysis. The paper reviews the current state of India’s participation in Asian IPNs identifying the policy challenges, and further undertakes an applied general equilibrium analysis of the above issue by utilizing the GTAP 8 database based on 2004 data to simulate the impact of tariff reduction in auto-parts for India’s currently implemented FTAs with ASEAN, Japan, Korea and EU. Additional scenarios of a productivity improvement along with reduction in trade costs along with the RTA, are also explored. The paper analyses the impact of these policy shocks on output, prices and trade volumes ,as well as their impact on overall welfare changes across all regions. The results point to the evidence that India that there are significant gains for India and its trading partners through export expansion and welfare improvements from better resource allocation not from an RTA alone, but from productivity improvement and reductions in trade costs as this should not only reduce border trade costs, but also network costs set up for an IPN.
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    Co-integration and the demand for energy in Fiji
    (Inderscience Enterprises Ltd., 2011-05-09) Kumar, S
    This paper applies alternative time series techniques such as general to specific (GETS) and Johansen maximum likelihood (JML) to estimate the long-run income and price elasticities of demand for energy for Fiji. We also test for the causal relationship between energy consumption, GDP and energy prices using the Granger causality tests. Our results imply that there is a uni-directional causality running from GDP to energy consumption.
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    Demand in New Zealand hospitals: expect the unexpected?
    (New Zealand Association of Economists, 2013-07-04) Jiang, N; Pacheco, GA
    The health care sector in New Zealand has undergone substantial structural reform since 1983, and stands out relative to other OECD countries, in that it has a relatively low per capita health expenditure, and a high share of public funding. Efficient allocation of resources to accommodate local needs in this community-oriented and public dominant model of the health care system is paramount. This paper employs the National Minimum Dataset from 2007 to 2011 to construct an empirical model aimed at predicting hospital demand. We formulate an easy to implement approach that can be used at the national level, as well as for individual District Health Boards (DHBs) that are regionally defined, and can also be disaggregated by category of patient, e.g. acute care versus elective admissions. We find the use of lagged information in this model to be vital, and by contrasting expected and actual demand, we then evaluate variations in excess demand. We find evidence that suggests in low risk elective cases, unexpected demand significantly reduces an individual’s hospital stay, and increases the likelihood of acute readmission in 30 days. Additionally, the cumulative evidence presented points to excess demand at both the hospital level and within-disease chapter, resulting in more attention paid to high risk patients, to the detriment of low risk cases. The negatively and significant association between hospital stay and readmission in 30 days for low risk cases may prompt policy makers to consider a ‘reduction in readmission program’ for New Zealand.
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    Do You Know That I Know That You Know…? Higher-Order Beliefs in Survey Data
    (Oxford University Press (OUP), 2021-01-30) Kumar, S; Coibion, O; Gorodnichenko, Y; Ryngaert, J
    We implement a new survey of firms, focusing on their higher-order macroeconomic expectations. The survey provides a novel set of stylized facts regarding the relationship between first-order and higher-order expectations of economic agents, including how they adjust their beliefs in response to a variety of information treatments. We show how these facts can be used to calibrate key parameters of noisy-information models with infinite regress as well as to test predictions made by this class of models. We also consider a range of extensions to the basic noisy-information model that can potentially better reconcile theory and empirics. Although some extensions like level-k thinking are unsuccessful, incorporating heterogeneous long-run priors can address the empirical shortcomings of the basic noisy-information model.
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    Does Economic Integration Stimulate Capital Mobility? An Analysis of Four Regional Economic Communities in Africa
    (Elsevier, 2013-11-14) Kumar, S; Sen, R; Srivastava, S
    It is well known that high levels of regional integration enable portfolio risk diversification and capital mobility. While there have been a number of empirical attempts to verify the presence of capital mobility using the Feldstein–Horioka (FH) approach, none of them to the best of our knowledge have explicitly examined capital mobility changes across regional economic groupings in Africa, analyzing sub-samples to compare effects of pre-versus post integration. Filling this gap in the literature, this paper analyzes how some major regional economic integration initiatives, such as SACU (South African Customs Union), UEMOA (West African Economic and Monetary Union), COMESA (Common Market for Eastern and Southern Africa) and ECOWAS (Economic Community of West African States)) have influenced capital mobility in their member countries. To estimate the investment and savings relationship, we use Pedroni's (2004) fully modified ordinary least squares (FMOLS) panel cointegration method, applying to a sample of 25 African countries for which annual data is available from 1960 to 2009. To assess robustness of our results, we also employ the fixed effects, random effects and Mark and Sul's (2003) dynamic OLS (DOLS) methods. Our findings suggest that international capital mobility has only slightly increased in the African countries due to these agreements.
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    Does New Zealand Economics Have a Useful Past? The Example of Trade Policy and Economic Development
    (Department of Economics, Faculty of Business and Law, Auckland University of Technology, 2015) Brooke, G; Endres, A; Rogers, A
    We examine the history of economic thought on trade policy in New Zealand from the 1920s to the early 1980s. The focus is upon the different doctrinal perspectives taken by academic economists in New Zealand. Throughout the period under review policymakers supported an inward-looking trade and development regime buttressed by extensive interventionist trade policy. Appeals to the employment argument for industrialization through import substitution lent their policies a veneer of economic respectability. Most economists were not persuaded; they railed against quantitative import controls, discriminatory tariffs and cumbersome export incentive schemes and they offered, in vain, some constructive alternatives relying on price signals rather than administrative rules. One of our main findings is that most of the early work exposited here anticipated the rent seeking explanation for the configuration of trade policy.
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    Efficiency of New Zealand's District Health Boards at Providing Hospital Services: a Stochastic Frontier Analysis
    (Seoul National University, 2018-07-06) Jiang, N
    The majority of secondary and tertiary healthcare services in New Zealand are provided through public hospitals managed by 20 local District Health Boards (DHBs). Their performance were measured by a set of indicators established by the National Heath Targets including elective surgeries, cancer treatment, and Emergency Department waiting times etc. Due to data issues and ill-judged generic public perceptions, efficiency studies for the NZ health system is insufficient in spite of its common international applications within the field of applied production economics. This inevitably leads to criticisms about the perverse incentives created by the Health Targets and its final abolishment by the newly elected Labour Government in January 2018. Utilizing a multifaceted administrative hospital dataset, this study is the first to measure both the technical and cost efficiency of NZ public hospitals during the period of 2011-2017. More specifically, it deals with the question of how hospital efficiency varies with activities reported under the National Health Targets after controlling for local patient structure. There is no evidence in the empirical results to suggest the proportions of elective surgical discharges or Emergency Department visits are increased at the expenses of lowering the overall efficiency of hospital operations. The national technical efficiency is averaged at 86 percent over the period and cost efficiency is 85 percent. The results are derived by stochastic input distance function and cost frontier in order to accommodate multiple outputs and limited number of census observations. Efficiency ranking is sensitive to specifications of the inefficiency error term, but reasonably robust to the choice of functional form and different proxies for capital input.
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    Estimating the cost of youth disengagement in Auckland
    (Dept. of Economics, AUT University, 2013-04-17) Pacheco, GA; Dye, J
    There has been growing interest in recent years in the labour market issues that youth face. Youth exclusion, disengagement, and overall underutilisation in the labour market has short term costs to the economy, as well as long term impacts on society. The consequences range from reduced economic productivity to increased criminal activity. We document a rise in the number of NZ youth classified as not in employment, education or training (i.e. NEET). This trend signals increasing difficulties for young people making the transition from education into the labour market. In this report we project the loss to productivity, measured in foregone wages, and the expected cost to public finances for Auckland and NZ NEET as at December 2012. We focus on youth aged 15-24 years, and where data are available report separately for 15-19 and 20-24 year olds. We find the expected per capita cost of each NEET youth aged 15-24 in the Auckland cohort to be approximately $28,981 over the next 1-3 years. The estimated cost is slightly higher than comparable costs for the aggregate group of NZ NEET, due largely to the higher foregone wages of Auckland NEET. Disaggregating our analysis by ethnicity, we find that Auckland NEET youth of Maori and Pacifica descent are associated with a relatively high per capita cost at roughly $33,634 and $26,629 respectively, compared to the analogous figure for their NZ European counterparts of $22,301 (all figures represent the estimated cost over the next 1-3 years). It appears that the difference is a result of the greater propensity of Maori and Pacific Peoples to disengage from the education system earlier, to withdraw from the work force due to caregiving responsibilities at a younger age, and to experience longer durations of unemployment than their NZ European counterparts. The sizeable estimated costs associated with NEET youth highlight the urgent need for policy intervention directed at improving transitions from NEET status to the workforce or further education / training. It should also be noted that these estimated costs are conservative in nature, and do not include expected costs that are difficult to quantify or attribute proportionally to NEET versus non-NEET status, e.g. impact on criminal activity, depression, substance abuse, psychological distress, etc.
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    Explaining Ethnic Disparities in Bachelor’s Qualifications: Participation, Retention and Completion in New Zealand
    (New Zealand Productivity Commission, 2017) Meehan, L; Pacheco, G; Pushon, Z
    There are substantial ethnic gaps in higher education in NZ, despite more than a decade of considerable policy effort aimed at this concern. This study uses newly linked administrative data to examine the underachievement of Māori and Pasifika relative to Europeans. We follow a population cohort born between 1990 and 1994 from school through to young adulthood to assess the relative contributions of prior academic performance, socioeconomic status and parental education to these gaps. Controlling for the relevant covariates narrows the Māori-European gap and completely eliminates the Pasifika-European gap in bachelor’s degree participation rates. Utilising Fairlie decompositions, we find that school performance is by far the largest contributor to the ethnic gaps. Low socioeconomic status and parental education are also pertinent, but less important. Our results suggest that ethnicbased policies aimed at encouraging participation are likely to have a limited effect if used in isolation, and signal the need for policy interventions earlier in the education system.
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    Extrinsic versus intrinsic motivation: does major choice make a difference?
    (New Zealand Association of Economists, 2013-07-03) Hedges, M; Pacheco, GA; Webber, D
    Prior literature emphasises supply side issues concerning the modularisation of university programmes such as curricula issues and enhanced learning opportunities. Comparatively little is known about the demand side, such as why students choose specific modules. This article presents an investigation that was specifically designed to improve understanding of the factors that contribute to student module choices and draws on a large primary dataset comprised of students following a wide range of majors at a new university business school. The dataset allows for differences between the relative importance of extrinsic and intrinsic motivations between majors to be identified and some implications of this to be discussed.
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    Factor-analysis-based Directional Distance Function: The Case of New Zealand Hospitals
    (School of Economics. AUT University, 2019-01-15) Jiang, N; Deng, Z; Ruizhi, P
    This paper develops a new factor-analysis-based (FAB) approach for choosing the optimal direction in a directional distance function (DDF) analysis. It has the combined merits of factor analysis and slacks-based measure (SBM) and incorporates the relative ease with which various input-output could be adjusted. This development relieves the dependency of price information that is normally unavailable in the provision of public goods. This new FAB-DDF model has been applied on a dataset containing all public hospitals in New Zealand (NZ) observed during 2011-2017. The empirical results indicate that the average reduction across different labor is in the range of 3-10 percent, and the corresponding figure for capital input is 25.7 percent. The case-adjusted inpatient-discharge and price-adjusted outpatient-visit are used as measures of desirable output, the average efficiencies are 92.7 percent and 99 percent respectively. Hospital readmission within 28 days of discharge is used as a measure for undesirable output, and the average efficiency score is 90 percent. These evidence support the suspicion that perverse incentives might exist under the National Health Targets abolished in 2018, which was a set of six indicators used in the last decade to evaluate the performance of local District Health Boards.
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    Fast decoding algorithms for coded aperture systems
    (Elsevier, 2014-08-01) Byard, K
    Fast decoding algorithms are described for a number of established coded aperture systems. The fast decoding algorithms for all these systems offer significant reductions in the number of calculations required when reconstructing images formed by a coded aperture system and hence require less computation time to produce the images. The algorithms may therefore be of use in applications that require fast image reconstruction, such as near real-time nuclear medicine and location of hazardous radioactive spillage. Experimental tests confirm the efficacy of the fast decoding techniques.
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    Firms' Asset Holdings and Inflation Expectations
    (Elsevier, 2018-04-10) Kumar, S
    This paper investigates the relationship between firms’ inflation expectations and their holdings of liquid assets. We implement a new quantitative survey of firms’ expectations about inflation in New Zealand. We find that firms that hold more shares of liquid assets systematically report lower inflation expectations. Moreover, we implement an experiment by providing firms new exogenous information about recent inflation dynamics. This experiment allows us to assess how firms respond to new information in terms of belief revisions and firm-level decisions.
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    Firm’s Asset Holdings and Inflation Expectations
    (Elsevier, 2020-01-15) Kumar, S
    This paper investigates the relationship between firms’ inflation expectations and their holdings of liquid assets. We implement a new quantitative survey of firms’ expectations about inflation in New Zealand. We find that firms that hold more shares of liquid assets systematically report lower inflation expectations. Moreover, we implement an experiment by providing firms new exogenous information about recent inflation dynamics. This experiment allows us to assess how firms respond to new information in terms of belief revisions and firm-level decisions.
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    The Good, the Bad and the Ugly of Lockdowns During Covid-19
    (Public Library of Science (PLoS), 2021-01-22) Rossouw, S; Greyling, T; Adhikari, T
    Amidst the rapid global spread of Covid-19, many governments enforced country-wide lockdowns, with likely severe well-being consequences. In this regard, South Africa is an extreme case suffering from low levels of well-being, but at the same time enforcing very strict lockdown regulations. In this study, we analyse the causal effect of a lockdown and consequently, the determinants of happiness during the aforementioned. A difference-in-difference approach is used to make causal inferences on the lockdown effect on happiness, and an OLS estimation investigates the determinants of happiness after lockdown. The results show that the lockdown had a significant and negative impact on happiness. In analysing the determinants of happiness after lockdown, we found that stay-at-home orders have positively impacted happiness during this period. On the other hand, other lockdown regulations such as a ban on alcohol sales, a fear of becoming unemployed and a greater reliance on social media have negative effects, culminating in a net loss in happiness. Interestingly, Covid-19, proxied by new deaths per day, had an inverted U-shape relationship with happiness. Seemingly people were, at the onset of Covid-19 positive and optimistic about the low fatality rates and the high recovery rates. However, as the pandemic progressed, they became more concerned, and this relationship changed and became negative, with peoples' happiness decreasing as the number of new deaths increased.
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