Economics research topics

The quality of research in the Economics department is reflected in the amount of leading journals that publish our work, and the calibre of existing and recent recruits to the academic staff. With our research environment and world-class facilities, we continue to attract brilliant academics from all over the world.

We look into economic theory, econometrics, public and experimental economics, and much more, which allows us to offer a truly excellent standard of teaching. Here is just a sample of what we are currently working on:

Public Economics

Right from the birth of Economics as a scientific discipline, Public Economics has always been one of its core branches. Public Economics considers how the choices of governments are made and how these choices can improve or hinder economic efficiency. Public Economics also investigates the extent to which it is possible, or desirable, for the government to change the distribution of income and wealth. To undertake this analysis, Public Economics draws upon influences from many areas of Economics. Professor Gareth Myles conducts leading research in this area, and has written numerous papers on the subject.

To border tax-adjust or not?

Professor Christos Kotsogiannis’ current research explores the role of trade instruments in globally efficient climate policies, focusing on the central issue of whether border tax adjustment (BTA) is warranted when carbon prices differ internationally. This line of research shows that tariff policy has a role in easing cross-country distributional concerns that can make non-uniform carbon pricing efficient, and that Pareto-efficiency requires a form of BTA when carbon taxes in some countries are constrained, a special case being identified in which this has the simple structure envisaged in practical policy discussion. It also stresses a point that has been overlooked in the policy debate that the case for BTA depends critically on whether climate policies are pursued by carbon taxation or by cap-and-trade. Professor Kotsogiannis is also interested in the design of Pareto-efficient carbon-tax reforms, as well as issues that relate to fiscal federalism, insecure resources and international trade, and the relationship between foreign direct investment and taxation.

On pollution externalities

Dr. Sushama Murty’s research on externalities such as pollution concerns problems that characterize both victims and generators of externalities. Technologies of victim firms violate the commonly evoked convexity assumption leading to failure of markets where the rights-to-pollute are traded, while the technologies of generating firms do not exhibit free-disposability of pollution. Sushama proposes a new equilibrium concept that satisfies the conclusions of the two fundamental theorems of welfare in non-convex economies with externalities. She proposes a new axiom, costly-disposability, and shows that, if an emission-generating firm’s technology satisfies this axiom, then it’s technology can be decomposed into a standard neoclassical intended-production technology and a nature’s emission-generating set (and vice-versa). This decomposition can be very helpful in both empirical and theoretical works, such as the design of welfare-improving externality policies, measurement of green GDP, and explanation of phenomena such as the environmental Kuznets curve.

Econometric time series analysis

Professor James Davidson is interested in all aspects of econometric time series analysis, asymptotic theory, and bootstrap methods in time series. His recent research has been largely concerned with long memory models and fractional integration. His Time Series Modelling (TSM) program is widely used for teaching at Exeter. While developed primarily as a tool for econometrics research, TSM is also used for data analysis by students and practitioners worldwide.

Financial structure and macroeconomic stability

During a time when governments around the world consider more carefully how to regulate their financial sectors, it should also be important to consider what kind of financial structure is better or worse for macroeconomic stability. Dr Jack Rogers is using contemporary standard macroeconomic modelling techniques (DSGE) to analyse normative monetary policy implications of fixed versus variable rate mortgage structure. Empirical work related to this also investigates the dynamic link between base interest rates and high-street mortgage rates in the UK.

Macroeconomics, history of economics and the economics of elections.

Professor John Maloney's research in Macroeconomics has included a project funded by the Nuffield Foundation to look at the effects of central bank independence, or lack of it, on 20 Western economies. In the history of economics thought, Professor Maloney has published books on Alfred Marshall and on Robert Lowe (classical economist and 19th century Chancellor) and is currently writing up the results of a Leverhulme-funded project on economic voting and the economic modelling of voting.

The Political Economy of Sovereign Debt

The decision to repay government debt is a political decision taken by political leaders who aim at being re-elected in a principal-agent game with citizen-voters. Dr. Giancarlo Ianulardo investigates to what extent domestic debt can be considered the relevant variable in debt repayment decisions and to what extent foreign creditors can interfere in domestic political decisions. Dr Ianulardo’s view is that “current research on sovereign debt is rightly focusing on the political determinants of a fragmented decision process, instead of considering the debtor as unitary actor”.

Applied International Economics

Dr Carlos Cortinhas interests are in International Economics, especially in applying contemporary econometric techniques to analyse the policy implications of different monetary regimes around the world. Another area of interest is international trade policy with special emphasis on trade policy in developing countries. Dr Cortinhas welcomes research proposals in these areas by students interested in pursuing  a dissertation

Decision theory, uncertainty and its applications

Professor David Kelsey’s research is concerned with choice under uncertainty and its applications in economics and finance, and,  in particular, with ambiguity (decisions where some or all of the relevant probabilities are unknown). A major area of research has been the impact of ambiguity in games. Applications include partnerships, asset pricing and the law of liability. Currently, Professor Kelsey is working on experimental tests of these theories. In the coming academic year, he will be working on a Leverhulme funded project on decision-making within firms. Topics studied will include how corporate governance influences behaviour in the product market. In particularly Professor Kelsey is interested in the factors which influence the way firms are organised e.g. the choice between for-profit firms, cooperatives and partnerships. This is relevant for issues such as mergers and corporate governance.

Professor Robin Mason’s area of expertise is Microeconomics. As he explains, thiswork  involves “understanding the decisions made by individuals and firms… and offers an incredibly powerful way to understand the behaviour that we observe: such as, why is popcorn so expensive in cinemas? Why does Legoland charge in the way that it does? What is the role of government in ensuring that markets work correctly?”

Professor Dieter Balkenborg’s research centres on game theory and its foundations. A substantial part of his work addresses evolutionary game theory and the long-run outcomes of learning and evolutionary processes. He has also worked on epistemic game theory, environmental economics, contract theory and experimental economics.

Trade and commodity market issues

Professor Steve McCorriston aims to “provide detailed insights into new aspects of policy and policy reform when market structure and competition issues are prevalent.” His research focuses on a wide range of policy issues, including trade policy, and trade policy reform when market structure is a characteristic of markets. He has also been investigating the issue of de-regulation of state enterprises and their impact on food security and trade, particularly in the context of the reform agenda in India. Currently, the impact of events arising on world commodity markets on domestic economies has attracted research funding from the European Commission. Collaborative research on tax issues and foreign direct investment is also in progress.

Theoretical, Computational and Experimental Economics

Professor Todd Kaplan’s research spans all of these areas. His theoretical work includes research on price competition, cost sharing and patent races. Todd has also made earlier contributions to the computational field. Probably his best known work is what is known as the ‘Kaplan’ strategy. This was a simple computer strategy that was written to compete in a double auction, a well studied environment in Experimental Economics which is a simplified environment of a stock exchange. It won a well advertised tournament sponsored by the Santa Fe Institute.

Dr Miguel A Fonseca believes that, “economics experiments are useful to test the validity of economic theories, test-bed new market mechanisms and better understand the fundamental principles behind individual and strategic decision-making.” He is currently using experimental methods to study behaviour in Microeconomic models, and specifically in issues relating to Industrial Economics, Public Economics and Game Theory.

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