Philip Bodman

Crime, punishment and deterrence in Australia: A further empirical investigation

The economic theory of crime is based on the assumption that rational individuals act to maximize their utility given the possibility of allocating their time or resources to different activities (including crime). Withers (1984) represents the only significant, aggregative empirical analysis of the determinants of crime, and importance of general deterrence effects, in Australia, derived on the basis of this market model economic approach to criminal activity. Extends the economic analysis of crime in Australia by employing a rigorous approach to both the specification of the underlying economic model of crime and to the estimation of the statistical relationships in the data. Uses improved data measures ‐ notably sentence length ‐ that represent more suitable proxies for the theoretical concepts of interest. The inclusion of labour force participation as a highly significant explanatory factor represents a major specification improvement over earlier studies. Examines four categories of property crime in Australia over the period 1982‐1991. The findings provide significant support for a number of the postulates of the economic theory of crime. These include the negative, deterrence effect of both clearance rates (as a proxy for the probability of punishment) and expected sentence length (as a proxy for the severity of punishment) on the number of property crimes committed. Also finds a significant deterrence relationship between the aggregate unemployment rate and the labour force participation rate and certain categories of property crime. These findings provide important support for the market model of crime and the general deterrence hypothesis and opposition to the continuing prevalence of the simplistic sociological analysis of imprisonment and recidivism, which ignores general deterrence effects.

Fiscal decentralization and economic growth in the OECD

What impact, if any, does Fiscal Decentralization (FD) have on economic growth? Further investigations of the inter-relationships between FD and economic growth are timely given that government decentralization remains at the forefront of many Organization for Economic Cooperation and Development (OECD) policy agendas. This study incorporates a range of measures of FD to better account for the direct impact of different levels of subnational fiscal autonomy on economic growth. The analysis also considers the impact of previously omitted public sector decentralization variables that provide further indication of the extent to which Subnational Governments (SNG) are ‘closer to the people’ and potentially better able to account for local preferences in fiscal decision-making. Whilst little evidence of a direct relationship between FD and output growth is found, some evidence is found to suggest that federal systems tend to have lower growth rates than do unitary states, independent of their degree of decentralization, and that countries with more elected tiers of government generally have lower economic growth.

Phases Of The Canadian Business Cycle

In this paper we contrast a number of univariate models of Canadian GDP. We find that non-linear models are prefered to linear models, and that the most recent recession in Canada was unique in both its length and in the slow speed of recovery. We also briefly explore the link between stages of the Canadian and of the US business cycle.

Assessing the roles that absorptive capacity and economic distance play in the foreign direct investment-productivity growth nexus

We further examine the channels through which Foreign Direct Investment (FDI) develops the national productivity of host countries. We investigate whether FDI is an effective channel of technological transfer across borders and whether that technology transfer is bi-directional: from an investing country to a host country and vice versa. In particular, an analysis is provided of whether FDI helps channel more resources towards the promotion of education activities and hence augments economic growth indirectly through augmenting the host countrys absorptive capacity. Also, the analysis uses a novel approach to take into account the possibility that physical distances can act as a barrier to economic and technological interactions amongst countries, by embedding a measure of geographical distance into two specific channels: international trade and FDI. Empirical results obtained all lend strong support to these hypotheses.

National savings and domestic investment in the long term: Some time series evidence from the OECD

This paper provides further evidence on the time series properties of national savings and domestic investment series using cointegration techniques. The findings in the paper for a sample of major OECD countries are in sharp contrast to most previous empirical findings relating to the Feldstein-Horioka puzzle. They provide preliminary evidence against what Dooley, Frankel and Mathieson (1987) call a “robust empirical regularity” and in favour of the assumption that International capital markets are highly integrated. [F21, F30.]

A Contribution on the Empirics of Trade, Migration and Economic Growth for Australia and Canada

This paper examines the long-run dynamic relationship between openness, migration and economic growth for Australia and Canada through the estimation of a long-run aggregate production function for each economy using the Johansen (1988) procedure. Through the disaggregation of the capital input vector entering into each cointegrating relationship, the paper also provides new evidence concerning the importance of human capital, dwelling capital, government infrastructure capital and research and development capital for long-run economic growth. The estimates from the empirical analysis suggest that net migration, openness and integration favours the productivity and growth performance of both Australia and Canada, although the magnitude of these relationships is not large. [E23, F15]

Remittances or technological diffusion: which drives domestic gains from brain drain?

This article examines the impact of technological diffusion and international migrants’ remittances on the economic development of less-developed countries. The hypothesis that skilled workers, living and working overseas, can effectively channel technological knowledge back to their home country, which in turn contributes to that countrys economic growth, is tested utilizing data on the stock of high-skilled workers from 50 developing countries working in industrialized countries over the last two decades. Results obtained lend strong support to this hypothesis. In addition, the effect that remittances from workers in developed countries, which are used for investment purposes in developing countries, have on the rate of growth of those developing economies is investigated. Our empirical evidence indicates that this remittance channel exerts a significant, positive impact on growth, although quantitatively the contribution of such investment-oriented remittances in driving sustainable economic development appears to be somewhat smaller than that of more general technological diffusion.

Output volatility in Australia

A number of papers have documented a significant decline in real GDP volatility in several major OECD economies. Some authors have presented evidence to suggest that this is the outcome of a one-off structural break from a high to low volatility state whilst others have estimated regime switching models that indicate low volatility regime states have dominated in recent years. This article provides further evidence on the general properties of output volatility for Australia, including evidence of a significant moderation in output volatility for the country that occurred in the early 1980s. Estimates of various GARCH models of real GDP growth are also provided to further examine shorter term volatility features of the Australian economy that are associated with its business-cycle. A regime shift dummy is maintained in all models of the conditional variance in order to account for the regime shift in volatility and evidence is found of significant business-cycle effects, including leverage effects and asymmetries that suggest recessions are times of higher output volatility than economic expansions. Overall, it is concluded that the so-called ‘Great Moderation’ in macroeconomic instability, as documented here for Australia, is a result of a myriad of economic, institutional and policymaking changes.

The One That Got Away? Crime and Punishment In Queensland's Commercial Fisheries

Analysis of a combined cross-sectional/time-series sample of records of the activities of patrol officers, reports of breaches of fisheries regulations, and associated court records in Queensland lends support to the hypothesis that economic factors are important in determining crime rates. An increase in the probability of apprehension, higher penalties, and reduced delays before cases are heard in court are predicted to reduce crime rates. The analysis also identifies a loss of reputation effect which suggests that moral and social factors are also relevant.

Are business cycles independent in the G7

Abstract In this paper we examine the relationships between business cycles in the G7 countries. We focus on whether recessionary periods in one country are independent of the timing of recessions in other countries in the G7, using three different methods for dating recessions. We find that the evidence is mixed on whether phases of the business cycle in North America and in European countries are independent, or whether there is a common phase structure in the business cycle across all the G7 economies. NBER dates suggest that business cycles are synchronised, while other methods for generating business cycle chronologies are more consistent with regional, rather than international cycles. We also find mixed evidence on whether the UK is synchronised with European countries, while Japan quite clearly has the cycle that is most independent of other G7 countries.