The Centre for Applied Finance and Economics has three main research groupings:

1) Applied Economics and Public Policy

Economics

The aim of research incorporated under this theme is to provide in-depth analysis to address real-world problems at the intersection of economics and public policy. A variety of economic methodologies and theoretical frameworks will be used to inform and evaluate public policy and social issues as they impact on the lives of Australians and on citizens globally.

Current research interests focus on the overlap between economic analysis and public policy in the areas of:

  • Cartels and business history;
  • taxation law, compliance and history
  • environmental impact of transportation
  • Economics of health policy and system reform
  • Economic growth and productivity growth in the long run
  • Roles of R&D, innovations and human capital in augmenting growth of nations
  • Theoretical and empirical analysis of auctions
  • Economic analysis of cognitive functioning and ageing
  • Corruption and special interest group behaviour
  • Sports Economics
  • Econometric evaluation of policy and social programs
  • Economic interconnections, monetary regionalism, and income growth convergence in emerging market economies (EMEs)

Behavioural Finance

Behavioural Finance relaxes the assumption held in traditional finance that people act rationally in order to maximise their wealth. By incorporating cognitive theories, Behavioural Finance examines how individuals make financial decisions and the consequential outcomes in financial markets and households. Our research focuses on the empirical application of Behavioural Finance at both individual and institutional level. Moreover, in our research we aim to gain a higher level of understanding of the behaviour and performance of market participants. Currently our research involves topics of risk perception and the effect of social interaction on investing.

Quantitative Finance and Banking Risk Management

Over the last few decades quantitative (mathematical) finance has provided solutions to many unresolved questions (e.g. asset pricing, arbitrage return, investment strategy) by merging theoretical developments in mathematical finance with practical application in financial markets. We have strong research interests in quantitative and mathematical finance, particularly in creating advanced methodologies, as well as in performing empirical and applied work in risk management and derivatives modelling.

The area of Banking Risk Management encompasses a number of fields within the area of financial economics. These include the operation and regulation of banks, corporate finance, financial education and asset pricing. Centre members’ research interests include: the risk management of non-performing loans and the composition and measurement of regulatory capital; the development and efficiency of transition economy banking and financial systems; the importance of governance and institutional structures in delivering efficient outcomes in transition and emerging-market economies; the impact of ownership concentration, particularly state control, on stock return performance in emerging market and transition economies; the changing geographic locus of control and industry concentration of the world’s largest companies.