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Why Wayne Swan should appoint a female academic to the RBA Board

Christopher Joye
11 January 2011

Okay, it is not easy to keep on top of this stuff from Hawaii (where I’m vacationing at the moment), but a few comments on the question of whether Treasurer Wayne Swan should reappoint Professor Warwick McKibbin to the Board of the RBA.

First, McKibbin is far and away Australia's best and most respected academic macroeconomist, and should be reappointed without question. The fact that he has had the fortitude to say what he thinks about public policy – on fiscal policy, the GFC, and climate change, to name a few – only reaffirms his outstanding independence. It is also well known that McKibbin is a hawk when it comes to holding RBA policymakers to account for positions that are not backed by credible analysis.

Second, if McKibbin is not reappointed, which, to be clear, would be a public disgrace should he make himself available for a further term at what is a critical policymaking juncture for the RBA (given the extraordinary uncertainty our central bank currently faces), then the Treasurer should look to appoint talented young monetary economists who can truly represent taxpayers interests in policy debates with the RBA and Treasury staff. This is, after all, the central purpose of the Board.

For the avoidance of doubt, Ross Garnaut is not a monetary economist, nor a currently practicing academic. Yet Australia does have two exceptional candidates in Professors Mardy Dungey and Renee Fry, who I hope will be considered in the event that McKibbin does not make himself available for some reason.

Professor Fry’s research focuses on issues surrounding international financial market and economic linkages, with an emphasis on financial market contagion and crises. Professor Dungey’s interests concern measuring the effects of international shocks on small open economies, and the transmission of financial crises and contagion across asset types and geographical borders. Both have world-class analytical skills.

Aside from the fact that these two young professors are the best available candidates, and in many ways substantially superior to Garnaut, they would also improve the diversity of the RBA's leadership by adding a second female to a currently male-dominated Board.

C'mon Julia – kick Swannie into line. I know you guys read this stuff.

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