Andrew Leigh

There has been an explosion of interest in behavioural economics over the past few years, and many interesting studies have shed new light on the often-irrational nature of human decision-making. I was fortunate enough to be invited along to the Grattan Institute in Melbourne to discuss how the insights of behavioural economics can help guide public policymaking. 

‘WHAT ROLE FOR BEHAVIOURAL ECONOMICS IN PUBLIC POLICY?’

ADDRESS TO THE GRATTAN INSTITUTE 

WEDNESDAY, 8 OCTOBER 2014 

MELBOURNE

While I was in graduate school, two of my classmates, Stefano DellaVigna and Ulrike Malmendier, carried out a study on gym visits. They obtained data from three Boston gyms, and analysed the attendance patterns of members.

Dividing annual fees by the number of visits, they found that the typical gym member spent $17 per visit, even although casual visits cost only $10. In total, the average member loses $600 compared with if they had just paid as a casual. The title of the paper? ‘Paying not to go to the gym’.

The Women's Legal Centre will have $100,000 cut from its funding by the Abbott Government in the 2015-16 and 2016-17 financial years. A constituent of mine got in touch to share her story about the Women's Legal Centre, and concerns about the government's cuts. Without community legal assistance she and her children would have been exposed to prolonged abuse and trauma. Sadly, her story is not unique, nor is it uncommon.

1 October 2014

I spoke in parliament to offer my condolences for the death of Emeritus Professor Anthony McMichael AO, and recognise his major contribution to our understanding of the links between climate change and human health.

This week I was fortunate enough to be invited to speak at the OECD-NBER Conference on Productivity Growth and Innovation in the Long Run in Paris. My theme was the relationship between inequality and social mobility; here's the details.

DOES TOO MUCH INEQUALITY PREVENT SOCIAL MOBILITY?

 OECD, PARIS

FRIDAY, 26 SEPTEMBER 2014

For much of the time we’ve been on the planet, humans have led a static existence. We lived where our parents lived. We did the jobs our parents did. The chances of moving up or down the ladder were limited.

 Indeed, that era was so recent that most of us still carry the mark of it. Most Anglo-Saxon surnames denote occupations (Smith, Archer, Miller) or places (Marsh, Hill, Lake), reflecting a time when few left their village or rose above their station.

 There’s nothing wrong with living in the same town as your parents, or following them into the same career. But for many of our forebears, this wasn’t a choice: it was a necessity. As recently as a few centuries ago, virtually everyone on the planet was consigned to a caste system.

 The lack of mobility wasn’t just unfair – it was extraordinarily inefficient. Imagine how many talented youngsters from poor backgrounds lived and died without a chance to use their skills. How many potential Mozarts were lost because they never got to hold an instrument? How many would-be Darwins were denied a decent schooling? How many budding Bill Gateses languished because they couldn’t get financial backing for their entrepreneurial idea?

I'm proud to be one of the inaugural conveners of the Parliamentary Friendship Group on Homelessness. It's really important that we talk about homelessness in our community so that those who are experiencing it don't become invisible. In my launch speech I shared the stories of a couple of Fraser locals who know first hand what it's like to live on the streets; now you can read about them too...

ADDRESS TO THE LAUNCH OF THE PARLIAMENTARY FRIENDSHIP GROUP ON HOMELESSNESS

I acknowledge the Ngunnawal people, the traditional owners of the lands on which we meet today; my co-convenors Senators Ludlam and Seselja; Shadow Minister for Housing and Homelessness Jan McLucas; Homelessness Australia CEO Glenda Stevens; Chris Hawley, who will share his story with us later; and the many members and senators who have joined us today.

Let me start with a story.

Glenn Tibbitts was born at 26 weeks in the back of an ambulance because his mother had endured another beating. Glenn’s first recollection of abuse he suffered was between the age of one and two. Around the age of 7 his parents broke up and as Glenn describes it: ‘the door of the cage was left open and that was my opportunity to go’. 

Like many communities around Australia, the Fraser electorate was devastated by the shocking loss of life in the MH17 air disaster. One of our own, Liliane Derden, died in that disaster, and in Parliament today I paid tribute to her life.

When Malaysian Airlines flight MH17 went down, it took with it someone who was from around here; someone who will leave a great gap where she lived; someone who resembled the rest of us in many ways.

Liliane Derden was a citizen of the world and a servant of the public.  Like so many locals, she could tell you what year she moved here; like so many Canberrans, she could tell you where she worked when she met her closest friend.  For many years, she lived not far from my family home, and indeed, not so very far from where we meet today.

Liliane Derden was a person entirely characteristic of this city and we all feel the effects of her loss.  But she was also a person with a private “life entire” whose death brings her closest friends and family inexpressible pains. 

Today I acknowledge Liliane – and we acknowledge the people who miss her most.

Her partner Craig.

Her daughters Cassandra and Chelsea.

Her family, in Australia and Belgium.

The Canberrans she worked with at the NHMRC and at Calvary Hospital; the communities of Ainslie and Hall where her loss is so deeply felt.

Chelsea wrote to me this week about her Mum: “she is very loved and missed by us all”.

Canberra is a considerate community.  We would never intrude, but we will never forget either, and we are here if you need us.

This was tragic, but it was not a tragedy; this was a crime.

Let the guilty be brought to justice, let the innocent rest in peace, and let those who remain know they are not alone.

Last night I joined the panel on ABC's The Drum to talk about how economics can help us make better sense of the world around us (and my new book 'The Economics of Just About Everything). Here's the interview:

This week I've been launching my new book 'The Economics of Just About Everything' with a series of public lectures around Australia. Here's the text from the Canberra launch, which was generously hosted by my old colleagues at the Australian National University:

SPEECH

WHAT DO DATING, DIETING AND SPORTS STATISTICS HAVE IN COMMON? 

LAUNCH OF 'THE ECONOMICS OF JUST ABOUT EVERYTHING'

ANU, CANBERRA, 29 JULY

Can I of course acknowledge that we are meeting tonight on the land of the Ngunnawal people, and recognise their elders past and present. There are so many good friends present in the room tonight, but I wanted to particularly acknowledge Bob Gregory and Rabee Tourkey for putting this together, and Beth Lawton and her team for making tonight happen. It was an event whose boundaries continued to expand and I'm very grateful to all of them for allowing that.

This book, 'The Economics of Just About Everything' comes from being at ANU and having extraordinary colleagues. I see many of them here around me in the room today, and in some sense this is your book as much as mine because I had such interesting and productive collaborations with many of you. 

As Bob said, the book is  'The Economics of Just About Everything', and when I mentioned this to my seven-year-old son, Sebastian, he said: 'Has it got dragons in it?' Sadly, I had to say: 'No, it doesn't have any economics of dragons.' And likewise, it doesn't have anything on the economics of Liberal Party leadership, or indeed on Labor Party leadership. But there are other contributions that you'll have the chance to read about.

I recently sat down with Jonathan Pryke from the Development Policy Centre to talk about inequality and how developing countries can manage this important challenge as their economies grow. Here's a quick summary, but you can also listen to the full discussion here: 

Inequality: should developing countries be worried? An interview with Andrew Leigh MP

by Jonathan Pryke and Andrew Leigh

I began by asking Andrew why he sees inequality as such an important issue:

I think inequality is a public good… I’ve always liked the John Rawls Veil of Ignorance way of thinking about this, where he asks you to imagine what sort of an income distribution you’d want if you were in utero and about to be born into a society where you didn’t know if you’d be born into the top 5^th or the bottom 5^th. Would you want the kind of Australia where the top 5^th has 62% of the wealth and the bottom 5^th has less than 1% of the wealth? If you knew that there was an equal probability of you ending up in either of those two quintiles, would you maybe want a more egalitarian distribution of income?

As honourable members know, Canberra is of course the best city in Australia.

It is the part of Australia which is the most egalitarian and the most generous. Canberrans are the most generous with their time and money. We are the sportiest. We have the highest rates of sporting participation. We are also the most equal part of Australia. So it is no great surprise to me—but it is, perhaps, to some other members of the House—that we have the best pharmacy in Australia.