Last week, I offered up two free tickets to the PolicyExchange conference for the people who could come up with the most interesting new policy ideas. Joshua Gans kindly added his two free tickets, so we had four to give away. From the dozen or so entries, congratulations to Kien Choong, Nathan Lambert, Hersh Sahai, and Steve Thomas. Their ideas are below, and the others are here and here. Thanks to all who put in an entry, and to Per Capita for the prizes. There were plenty of clever ideas, and I would have happily given away more tickets if I’d had them.
Kien Choong – A Second RBA Policy Instrument
There seems broad sympathy for the idea that central banks should pre-empt asset bubbles, but also strong reservations as to whether interest rates are the right instrument. Here is another instrument: in the case of residential asset bubbles, give the RBA the power to put a cap on proportion of debt a bank can give to finance the purchase of residential properties without mortgage insurance. I believe at one time, banks required borrowers to take out mortgage insurance for loans exceeding 80% of the property value. The RBA could vary that proportion from time to time. This way, the RBA has two instruments: short-term interest rates for controlling the (growth of) the price of goods, and cap on leverage for controlling the (growth of) the price of assets.
[I also liked Kien’s Future Fund idea.]
Nathan Lambert – ABS Political Polling (and Daily Centrelink Data)
The desire of the government to be re-elected is a factor in any policy-making exercise. But because of the stigma attached to “poll-driven politics”, ministerial offices are reluctant to commission polls, or to tell anyone about it if they do. Instead they rely on instinctive judgments about public opinion, with the inevitable increase in uncertainty and error. In particular, policy-makers tend to over-estimate how much their particular policies might lose the government votes, and thus are more risk-averse and populist than need be. A series of ABS polls on 15 or 20 key issues would address this. As an adjunct policy, secret government polling could be banned.
Or a shorter one maybe…
That Centrelink should release its NewStart application figures on a daily basis.
Hersh Sahai – An Online Australian University
Federal Govt to subsidise a national online higher education program where students can obtain a tertiary qualification in an online setting. Pooling the most talented experts in each field to deliver a course to students across the country. Online videos, podcasts and reference links will assist students sufficiently to obtain materials to learn the course as intended by the lecturer. Exam and assignment set by the lead professor, with the best tutors being selected across the country to tend to consultations using web-share applications such as SameTime Unyte. This kind of specialised, far reaching, higher education will surely enhance the skill sets of young Australians… Not to mention enhancing the exportability of our education services.
Steve Thomas – School partnerships
A criticism of improving access to schools is that popular schools’ rolls fill up meaning some families can miss out on the school they prefer for their child. This problem could be solved partly by allowing schools the freedom to form partnerships with schools whose rolls decrease. This would allow popular schools to offer more of the kind of education that parents want on a different site and make best use of existing school capacity. Popular schools could also share teaching, managerial and governance expertise with schools that have declining rolls, creating an opportunity to improve partnering schools’ teacher quality and leadership culture.