Research Evaluation Down Under: An Outsider's View from the Inside of the Australian Approach

Australia is currently undertaking its first national evaluation of university research, which is being performed by the Australian Research Council (ARC) at the request of the Australian government. The Australian approach to evaluation has some unique characteristics, especially a focus on evaluating research quantity and quality by the field of the research activity rather than by individual academic or administrative unit. This raises issues of the classification of areas of research, which has already caused controversy for Australian heterodox economists. There is also controversy about the quality rankings of economics journals. This article provides a critical review of the Australian approach to research evaluation and discusses the implications for heterodox economists.     

Price Discrimination in the Subscription Market for Economics Journals

We examine what factors affect the degree of price discrimination for an academic journal by analyzing data on 190 of the 208 economics journals indexed in the 2008 edition of Journal Citation Reports. We find that (i) the library‐to‐individual price ratio of a for‐profit journal is 37% higher than that of a comparable nonprofit journal because the price premium of a for‐profit journal in the library market is disproportionately larger than that in the individual market, (ii) journals with higher citations per page or impact factor are more price discriminatory, and (iii) Elsevier and Wiley‐Blackwell practice the highest degree of price discrimination of all publishers.     

Bank valuation and accounting discretion during a financial crisis

This paper shows that banks overstate the value of distressed assets and their regulatory capital during the US mortgage crisis. Real estate-related assets are overvalued in banks' balance sheets, especially those of bigger banks, compared to the market value of these assets. Banks with large exposure to mortgage-backed securities also provision less for bad loans. Furthermore, distressed banks use discretion over the classification of mortgage-backed securities to inflate their books. Our results indicate that banks' balance sheets offer a distorted view of the financial health of the banks and provide suggestive evidence of regulatory forbearance and noncompliance with accounting rules.     

Lifetime Generational Accounts for the Netherlands*

Conventional generational accounting only includes future benefits and burdens from the government. This paper's contribution is to include past benefits and burdens as well, and in this way to provide a full lifetime account of how much current and future generations benefit from government, in net terms, under various future policy lines. The calculations are carried out for the Netherlands and for the cohorts born since 1946. The more complete picture may be helpful for political decision‐making on equitable intergenerational policies. A second contribution of this paper is that it uses a more comprehensive benefit concept than other such backward‐looking studies by including non‐cash benefits as well. The results point out that there are substantial differences in net lifetime benefits between generations and these are mainly driven by non‐cash benefits such as education and healthcare, on which expenditure increased substantially after 1946.     

Governance mechanisms for mobile service innovation in value networks

Service innovation often requires multiple organizations to work together in complex, dynamic networks. Existing literature shows that mechanisms like trust, power and contracts govern activities in organizational networks. Scholars rarely study how such a mix of mechanisms evolves over time, especially not in relation to different stages of service innovation. This paper connects a phasing model on service innovation to concepts of inter-organizational governance in value networks, by examining what governance mechanisms are in use during service development, implementation and commercialization. This study analyzes an international survey among operators, content providers and application developers in the Mobile Internet services domain, which is noted for its complex inter-organizational networks. The findings suggest that power-based governance is in use in the early stages of developing service concepts and technologies, while trust-based governance is in use during implementation, roll-out and commercialization. Contract-based governance is most common during implementation and roll-out.     

Empowering parents to improve education: Evidence from rural Mexico

We examine a very inexpensive program in Mexico that involves parents directly in the management of schools located in disadvantaged rural communities. The program, known as AGE, finances parent associations and motivates parental participation by involving them in the management of primary school grants. We find that AGE reduced grade failure by 7.4% and grade repetition by 5.5% in grades 1 through 3. However, while AGE was effective in poor communities, it had no effect in extremely poor communities.     

Do Chinese farmers reinvest in grain production?

Grain production is affected by the relocation of farm household labour from on-farm to off-farm activities and by an increase in the investment in grain production as a result of increase in farm household income that occurs along with such a labour shift. This study uses a recent farm household survey data to examine whether Chinese grain households do reinvest in grain production. It has found that household income growth contributes to higher investment in grain production although a higher share of non-agricultural income has a negative effect. The authors' other research has found a negligible direct impact of farm to non-farm labour transfer on grain production. We may conclude that in the near future, the total impact (direct and indirect) of labour transfer from farm to non-farm production on grain output is expected to be positive. In the long run, in may become negative when more and more labour shifts out of grain production and marginal product of labour becomes positive.     

Why manage behavior? a case for positive reinforcement

Present “intuitive” practice in industry relies on punishing people for failing to perform. This seldom works toward gaining positive results. But positive reinforcement can work since it is directly oriented to desired results.     

Changes in the International Competitiveness of Australian Manufacturing: 1968 to 1989

Disaggregated data for twenty-seven Australian manufacturing industries are used to examine movements in international price competitiveness relative to each of sixteen major trading partners over the period 1968 to 1989. The changes in price competitiveness are decomposed into elements of exchange rates, tariff rates, profit margins and unit production costs. Great diversity in outcomes is found across both industries and trading partners, with differences in the growth of labour productivity and the cost of materials most closely associated with divergence in outcomes. The results show that domestic manufacturing industries have been able to achieve improved international competitiveness, where they have outperformed comparable industries in Australia's trading partners in terms of labour productivity growth or reductions in the costs of materials.