UNSW Business School sweeps ARC funding

Research on regulating over-the-counter financial markets, analysis of ecosystem services in productivity measurement, and retirement income product innovation are among UNSW Business School applications awarded grants in the latest round of Australian Research Council funding.

Professor Michael Sherris in the School of Risk & Actuarial Studies (and Dr Jonathan Ziveyi , CEPAR) have been awarded $350,000 for a Discovery Project into “Retirement Income Product Innovation”.

This project provides innovative solutions to the current and topical issue of financing retirement risks with a comprehensive retirement income product.

“Products that effectively manage financial and longevity risk are virtually non-existent in Australia, partly due to the lack of comprehensive research into how product design impacts costs and risks,” he said. “There is a lack of sophisticated models for use in the analysis of the risks and the design of products, and the lack of effective risk management solutions for product providers to hedge and manage the risks efficiently.”

Associate Professor Benoit Julien in the School of Economics (with colleague Dr Guillaume Roger) has also been awarded a $139,000 grant for a Discovery Project titled “Decentralized assets trading, centralized clearing and systemic risk”.

“One of the main factors that exacerbated the severity of the 2007-09 financial crisis was the lack of transparency of over-the-counter financial markets,” he said. “In response regulators around the world decided to mandate centralised clearing to reduce system-wide risk.”

He said this research projects aims to study the economic consequences. “It will study the behavioural impact of shifting risk from market participants to clearinghouses and suggest remedial policies that could be implemented by clearinghouses to control the risk appetite of market participants.”

He has also been awarded $165,000 for research into “Productivity, growth and unemployment in economies with frictions”, examining the roles that government policies (fiscal, monetary, and education) play in determining decisions, and identifying the best configurations of these policies.

Professors Kevin Fox and Erwin Diewert (School of Economics and CAER) with colleagues Professor Rupert Grafton and Mr Carl Obst have been awarded a $320,000 grant for a Discovery Project titled “Natural Resources and Ecosystem Services in Productivity Measurement”.

Professor Kevin Fox said “The Federal Treasurer Scott Morrison noted in a National Press Club Address earlier this year that the need for productivity, innovation and incentive in our economy has never been more important. This project responds to these needs, and will develop a new framework for measuring and understanding productivity while accounting for contributions from non-renewable resources and ecosystem services.”

“This is essential for understanding the sustainability of productivity and economic growth,” said Professor Fox. “If our productivity and income gains are due to the depletion of natural resources and destroying ecosystems, then this is unsustainable. By accounting for resource depletion and the use of ecosystem services in production, this project tackles issues of practical and immediate importance for a more accurate assessment of Australia’s productivity performance and the sustainability of economic growth.”

The UNSW Business School had seven successful applications, including two DECRAs:

• Dr Keiichi Kawai (School of Economics) for a Discovery Early Career Researcher Award (DECRA) titled “Competition in Persuasion” in FoR code 1401: $311,000
• Dr Seojeong Lee (School of Economics) for a Discovery Early Career Researcher Award (DECRA) titled “Misspecification-robust inference for models of economic behaviour” in FoR code 1403: $331,000
• Professors Kevin Fox and Erwin Diewert (School of Economics and CAER) with colleagues Professor Rupert Grafton (University of Melbourne) and Mr Carl Obst (ANU), for a Discovery Project titled “Natural Resources and Ecosystem Services in Productivity Measurement” in FoR code 1401: $320,000
• Associate Professor Benoit Julien (School of Economics) with colleague Dr Guillaume Roger (University of Sydney), for a Discovery Project titled “Decentralized assets trading, centralized clearing and systemic risk” in FoR 1401: $139,000
• Associate Professor Benoit Julien (School of Economics) with colleagues Assistant Professor Liang Wang (University of Hawaii at Manoa, USA), Professor Randall Wright (University of Wisconsin, Madison, USA), and Professor Ian King (University of Queensland), for a Discovery Project titled “Productivity, growth and unemployment in economies with frictions” in 1401: $165,000
• Professor Michael Sherris and Dr Jonathan Ziveyi (School of Risk & Actuarial Studies and CEPAR) with colleague Professor Annamaria Olivieri (University of Parma, Italy), for a Discovery Project titled “Retirement Income Product Innovation” in 1502: $350,000
• Associate Professor Li Yang (School of Banking & Finance) with colleague Professor Frederick Foster (University of Sydney), for a Discovery Project titled “Investment Irreversibility, Policy Uncertainty, and Hedging Strategies” in 1502: $264,000

Some of our academics also had successful applications submitted through other faculties and universities:

• Professor Valentyn Panchenko (School of Economics) with colleagues Associate Professor Mikhail Anufriev (UTS) and Associate Professor Paolo Pin (IGIER, Bocconi University) for a Discovery Project in FoR 1402: $386,000
• Professor Denzil Fiebig (School of Economics) with colleagues Professor Jane Hall (UTS) and Associate Professor Kees van Gool (UTS) for a Discovery Project in FoR 1402: $441,500

Media contact: Julian Lorkin: 02 9385 9887 | 0405 805 365 | j.lorkin@unsw.edu.au