Celebrating 50 years of in-depth socio-economic research

“As Australia’s leading and longest standing research institute in the field of economics, we have a proud tradition of pursuing cutting-edge research into key issues relevant to contemporary society.”

Welcome from the Director

2012 marked the 50th anniversary of the Melbourne Institute.

Established in 1962, it was the first research institute of its kind in Australia. Over its long history, it has enhanced the wellbeing of all Australians by delivering high-quality, independent research that makes a sustained contribution to economic and social policy development.

The Melbourne Institute is now firmly established as one of the world’s leading economic and social policy research institutes – and we look forward to the next 50 years of contributing to economic and social policy for the benefit of all Australians.

We welcome government departments, corporate and not-for-profit organisations, and potential research students to learn more about the Melbourne Institute. You will see how our important, ongoing work is helping to shape a better future.

Professor Deborah Cobb-Clark Ronald Henderson Professor and Director

Socio-economic diSadvantageSocial and economic disadvantage weakens the fabric of society. It increases inequality, threatens social justice and creates barriers to education, employment and housing. It is our goal to help counter such disadvantage.

Through our research, we seek to understand the extent of such disadvantage in Australia, investigate its impact on life outcomes, and develop policies to reduce it.

Socio-economic reform is something we have long been passionate about. The Melbourne Institute produced the first Henderson Poverty Line estimates in 1973, and quarterly updates continue today. We also publish an annual Social Exclusion Monitor in partnership with the Brotherhood of St Laurence, which acts as a measure of social exclusion and identifies the many barriers that limit an individual’s ability to participate in society.

Beyond these studies, we pursue a broad range of research projects in collaboration with state and federal government departments and corporate partners.

Public Sector PerformanceThe public sector absorbs 25% of Australia’s GDP – yet enjoys little microeconomic reform, in part due to the challenges around measuring productivity and outcomes. Improving the equity and efficiency of the public sector is critical to ensuring that we deliver on major social agendas in education, health and social assistance.

Across the Melbourne Institute, researchers work to measure public sector productivity and to better understand the role of incentives, competition and the private sector in boosting public sector outcomes. Our work plays a key role in improving the evidence base for public sector policy design, and helps to shape the important spending decisions across the health, education and welfare sectors.

Productivity and living StandardSEconomic growth and improved productivity are central to future improvements in Australian living standards, as they enable more resources to be directed to consumption and investments in infrastructure such as roads, schools and hospitals.

The Melbourne Institute undertakes research to deliver evidence-based information that will help the public, business and household sectors make better decisions about growth and employment opportunities.

We study the drivers of economic growth and business cycles, and how stabilisation policies improve economic welfare. We seek a better understanding of the determinants of economic activity, the causes of unemployment and the drivers of the inflationary process, to build upon our knowledge of the macroeconomy, particularly Australia’s sensitivity to global factors.

We also study how Australian industries can boost their competitiveness as the economy becomes more globally integrated, and how firms can perform better within the global supply chain. These studies advance our understanding of the innovation process that is so critical to both productivity and growth.

Key Areas of Research

The Melbourne Institute undertakes research across four key areas – socio-economic disadvantage, public sector performance, productivity and living standards, and fostering health and wellbeing. In each of these areas, we remain focused upon building the evidence base for reform and contributing to public policy.

To support our research, we are involved in the collection and analysis of survey data, and the measurement of economic and social indicators. This work gives us and other organisations the tools and data we need to help shape policy.

Melbourne Institute of Applied Economic and Social Research 1

“From developing longitudinal research tools to using data to build an evidence base for reform, the Melbourne Institute is renowned for the rigour and quality of our applied economic and social research.”

According to the World Health Organisation, “health is a state of complete physical, mental and social wellbeing and not merely the absence of disease or infirmity.” At the Melbourne Institute, we concur – acknowledging that issues around health and wellbeing span far beyond the realm of medicine and require a multidisciplinary research approach.

As such, the Melbourne Institute has a number of research programs exploring ways to boost the health and wellbeing of Australians – particularly Health Economics, Labour Economics and Social Policy, and the HILDA Survey.

We seek to contribute to a better understanding of the factors that drive good outcomes in health and wellbeing, with a focus on social science and economics. Understanding that the best outcomes will be achieved by taking a multidisciplinary approach, we are building strong relationships with other researchers at the University of Melbourne and elsewhere.

To develop strong economic and social policy, it is critical to draw upon evidence. The Melbourne Institute has extraordinary expertise and experience in the analysis of economic and social data. We have built an enviable, world-class reputation for providing and managing survey data.

From the large-scale surveys we undertake, we gain rich insights which help to inform Australian public policy that contributes to the betterment of people’s lives.

The Melbourne Institute is involved in four major data collections:

1. Household, Income and Labour Dynamics in Australia (HILDA) Survey

This is Australia’s only nationally representative household panel study (funded by the Australian Government Department of Families, Housing, Community Services and Indigenous Affairs).

2. Journeys Home: A Longitudinal Study of Factors Affecting Housing Instability

This is a survey of a sample of Centrelink clients identified as being homeless or at risk of, or vulnerable to, homelessness (also funded by FaHCSIA).

3. Medicine in Australia: Balancing Employment and Life (MABEL) Survey

This longitudinal survey of over 50,000 Australian doctors is funded by a grant from the National Health and Medical Research Council, and seeks to improve our understanding of how changes in the working lives of Australian doctors influence the provision of healthcare.

4. Consumer Attitudes, Sentiment and Expectations in Australia (CASiE) Survey

This monthly telephone survey of households commenced in 1974 and is the source of, among other things, the Westpac – Melbourne Institute Consumer Sentiment Index.

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collection and analySiS of Survey data

foStering HealtH and Wellbeing

We have a long tradition of contributing to the measurement of economic and social indicators.

Our researchers have developed a range of tools that provide invaluable insights and current information about the pulse of the Australian economy, which are released well ahead of official statistics. As such, they are used widely by business analysts and policy makers. We are also committed to the ongoing measurement of social indicators such as the poverty line and social exclusion, and produce reports that provide valuable reference material for those concerned with social welfare policy in Australia.

Examples include:

1. The Westpac – Melbourne Institute Leading Index of Economic Activity

This provides a view of the state of the economy based on information from several variables which reflect different aspects of the economy.

2. The TD Securities – Melbourne Institute Inflation Gauge

This estimates the month-to-month price movements for a wide-ranging basket of goods and services across the main capital cities of Australia.

3. The Melbourne Institute Survey of Consumer Inflationary Expectations

This measures consumers’ beliefs about whether, and by how much, prices will change over the coming twelve months.

4. The Westpac – Melbourne Institute Survey of Unemployment Expectations

This presents consumers’ views about whether unemployment would be more, the same or less in the coming twelve months.

5. The Westpac – Melbourne Institute Consumer Sentiment Index

This provides an indication of the confidence that households have about financial and economic conditions in Australia.

6. Poverty Lines: Australia

This quarterly newsletter updates the Henderson Poverty Line as defined in the 1973 Commonwealth Commission of Inquiry into Poverty, presenting minimum income levels required to avoid a situation of poverty for a range of family sizes and circumstances.

7. Social Exclusion Monitor

Developed by the Brotherhood of St Laurence and the Melbourne Institute, this monitor uses the HILDA Survey to gauge how many people experience forms of social exclusion in Australia.

8. PwC Melbourne Institute Asialink Index: ANZ Services Report

This report examines Australia’s trade in four services – education, transport, finance and business services – with 16 Asian countries.

meaSuring economic and Social outcomeS

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economicS of education and cHild develoPment ProgramFunded by the Victorian government, this research program aims to address many fundamental questions about childhood development and education, the experience of schooling and transitions to further education and the labour market. Our goal is to improve outcomes for students from all social backgrounds.

Director: Associate Professor Chris Ryan

HealtH economicS ProgramWe conduct rigorous, relevant research across a number of areas of applied health economics. While based in the Melbourne Institute, this program includes researchers from the Department of Economics and School of Population Health at the University of Melbourne – ensuring that we have the necessary depth and breadth of skills to bring to this important research. The Health Economics research program team administers the MABEL longitudinal survey.

Director: Professor Anthony Scott

Hilda Survey ProgramThe HILDA Survey – the household-based panel study which began in 2001 – collects valuable information about economic and subjective wellbeing, labour market dynamics and family dynamics. It is an important tool that is relied upon by policy makers and other researchers to help shape a better future for all Australians. The HILDA Survey team also pursues its own independent research in areas such as income mobility and distribution, labour market dynamics and panel survey methods.

Director: Professor Mark Wooden

Research Programs

“In all of our research work, we remain proud of the fact that we are making a positive difference in our society.”

The Melbourne Institute engages in a wide range of research in six key areas. Our collaborative, interdisciplinary approach (overseen by the Director, Professor Deborah Cobb-Clark, and Deputy Directors, Professor Guay Lim and Professor John P. Haisken-DeNew) ensures that the best resources are applied to each research project we undertake.

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macroeconomicS ProgramOur quantitative macroeconomics research explores a range of issues, taking an aggregate economy-wide perspective. This research is frequently used to influence public policy, and can be found in respected international and Australian journals. The Macroeconomics research program team also produces a range of reports about the Australian economy in collaboration with respected financial institutions such as Westpac and TD Securities.

Director: Professor Guay Lim

labour economicS and Social Policy ProgramWith funding from a variety of government and non-government sources, this research program investigates a broad range of labour market and social policy issues, with a focus on income distribution and social inclusion. Disadvantaged groups in society, such as individuals on a low income or with low skills, are of particular interest with an aim to improve their circumstances through appropriate policies. Health and education are important factors in much of the research.

Director: Professor Guyonne Kalb

induStrial economicS ProgramWe take an applied approach to our research into Australian industrial problems and policies, with the main research themes including the economics of innovation, intellectual property and productivity. Our analysis is focused upon company and industry behaviour, policy performance and industry dynamics. All staff are affiliated with the Intellectual Property Research Institute of Australia.

Director: Professor Beth Webster

Doctoral students at the Melbourne Institute conduct research in a wide range of macroeconomic, microeconomic and socio-economic issues. The Economics Doctoral program (run jointly with the Department of Economics) emphasises independent, original work and collaboration with leading scholars and major Australian organisations; and is widely acknowledged as international best practice. Candidates graduate with a Master of Economics and a PhD.

See www.melbourneinstitute.com/ miaesr/who/study_PhD.html

Director: Professor John P. Haisken-DeNew

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Doctoral Program

melbourne inStitute of aPPlied economic and Social reSearcH The University of Melbourne Victoria 3010 Australia Tel +61 3 8344 2100Fax +61 3 8344 2111Email melb-inst@unimelb.edu.au Web www.melbourneinstitute.com