Data-driven business policy
Sound decision-making and policies are based on good evidence. Swinburne is working to unlock the evidence to support sound business policy for Australia.
Government policy change is generally slow and difficult to achieve, often because objective and robust evidence for change is not available. At the same time, many government departments collect detailed administrative datasets. But these datasets are large and unwieldy, and often contain confidential data.
The arrival of cheaper computing power and mechanisms to de-identify confidential data has made it possible to convert government datasets into valuable tools to inform policy debate and support policy decisions.
Cleaning data to develop effective policy
The Swinburne industrial economics team, along with the Swinburne Data Science Research Institute – has worked with government agencies to clean and link government datasets, and then to use the data to help government to develop effective policies.
Since 2011, the team has addressed 18 separate policy issues in collaboration with four government organisations: the Australian Bureau of Statistics; IP Australia (the government agency responsible for patents, trade marks, designs and plant breeder rights); the Australian Department of Industry, Innovation and Science; and the Victorian Department of Economic Development, Jobs, Transport and Resources.
Research targeted to policy
The research has aimed to better understand what drives business to improve performance. The team has examined a range of questions:
- Does the patent system assist collaboration between the public and private sectors?
- Is the international patent system biased against foreign applicants?
- Does participation in trade mission programs lead to higher exports?
- Does participation in other government business programs lead to higher sales and employment?
- Does research and development (R&D) by one firm generate benefits for other firms in the same industry?
Each research project informed a specific policy need – such as the Australian Government’s R&D Tax Incentive program (valued at approximately $3 billion a year) and the Victorian Trade Mission Program.
Swinburne research on innovation policy, which includes the study of spillovers effects of R&D, additionality and collaboration has been useful for building policy evidence. The Department of Industry, Innovation and Science used Swinburne’s report, “The Additionality of R&D Tax Policy in Australia” as important evidence to support the 2016 Review of the R&D Tax Incentive program. The group has also been a pioneer and sophisticated user of the ABS’ Business Longitudinal Analysis Data Environment and developed important econometric evidence of
the link between collaboration and productivity growth in small businesses.
Office of the Chief Economist
[Swinburne] research has contributed to both policy development and evaluation in this department. It has enabled us to move from relying on a mixture of self-reporting by grant recipients … to assessing the effectiveness of sole classes of program intervention by type of policy response. As a consequence, we are now designing our business grants taking
into account the findings of the grant impact evaluation … [which] has been a key factor in the changes to program design currently under consideration.
Victorian Director (Outcomes, Performance and Evaluation)
Department of Economics Development Technology, Jobs and Resources
The projects involved close collaboration with staff from the government agencies, using datasets such as Australian Taxation Office unit record data on business sales, employment exports and investment, and registrations of patents and trademarks. Results of the research have been presented to policymakers, and the team continues to contribute objective evidence into economic debates in Australia through public presentations and publications.