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Diminishing economics training at La Trobe University

La Trobe University’s “Future Ready” restructuring commenced over the last 2 days.  My School of Economics was dished out its medicine today.

The current School will become part of a Department of Finance and Economics (the lack of alphabetical ordering in the 2 components is significant). Proposed staff cuts in economics are from 28 to 10 faculty.  Is that a bloodbath or a restructuring?

The current four professors in the School will be reduced to 1, the 5 Associate Professors will be cut to 2 with smaller cuts as academic level decreases – the only faculty member guaranteed a position in the new structure is an “Associate Lecturer”.  Everyone else must lodge a request for a position in the diminished structure.

This will certainly save money for La Trobe because cuts are concentrated among the more expensive top positions.   Of course this also means discarding the strongest CVs and those with most teaching and research experience. I cannot understand however how a cohesive academic program can be developed with so few positions.  In my view the minimum viable number would be 18 faculty but as staff are already fully employed in terms of the university’s own workload model the optimal figure is above that.   How can a business area in Australia function effectively without a strong economics presence?  In addition, in my view, the economics area should be a separate department. As there are still opportunities to revisit the structural changes proposed these changes to the proposed plans should be a target.

I am unsure how to respond myself.  I currently supervise 2 PhDs and am supposed to teach two courses next semester as well as help with a third.  The decisions today were a bombshell for me because my sense of the value of an economics qualification is strong and I see these moves as undermining that.

The Australian makes some brief general comments. I’ll add more if I see them.

Here is a more recent article on the devastating cuts to economics at La Trobe. One question to reasonably ask is where the evidence is for a switch away from economics at other Australian universities? This is now an explicitly stated rationale for the cuts. There is a difference between a collapse in demand and a shift toward a service role for economics. This shift occurred at La Trobe 10 years ago. It is also difficult to understand how moves that have taken away core units from the economics curriculum after 2011, that have occurred at La Trobe, have anything at all to do with a collapse in demand. Finally, one can ask whether students at non-G8 universities are to be denied access to professional training in economics.

25 comments to Diminishing economics training at La Trobe University

  • Uncle Milton

    Harry, this is appalling. How did it come to this?

  • hc

    I can’t answer that without creating difficulties. Ask the Dean, Leigh Drake who is an economist or John Dewar, VC, who can advise on the “Future Ready” Strategy. I don’t appreciate any of the accounts that have been delivered to me.

  • Uncle Milton

    It’s not a good time to be an unemployed economist (I don’t mean you). Treasury is cutting 300 positions.

  • Hillel Freedman

    Its quite clear from the policies of the federal government that they are economic imbeciles and igoramaces. Their policies of attacking education and health stand up to no econmic analysis. How can an uneducated and sick population be at all productive? How can a country with no carbon tax expect to compete internationally in a 21st century economy?

    These policies serve the interests of ideology and the big corporate backers of the No alition

  • Sinclair Davidson

    So sorry to read this.

  • Michael K

    Harry, I am so sorry to hear about this. La Trobe had an excellent economics program and I feel very fortunate to have received a top economics education from La Trobe in the early 90s. This is very depressing.

  • The Orwellian title says it all. “Future Ready”. I guess that’s one down from Future Proof.

  • Peter Rickwood

    Such a shame Harry. I’m not an economist, but in my area your work with Prentice on transport externalities/taxation/pricing was a real eye opener. Hope it all pans out as well as can be hoped for. I suspect “Future Readying” of this sort might be in store for much of the university sector once private operators move in and the focus moves to lower fee narrow industry-focussed courses. Not a good thing for Australia.

  • Wow. That’s worse than we’ve had here at Canterbury. We were 20 pre-quake, we’re going to be 10 after the current redundancy round. At least they’re running it where you get to reapply for your own position. Here, they based cuts on which courses they thought could be considered luxuries in a constrained environment, then sought the redundancies of those who taught those courses, regardless of their research record, teaching skills, or administrative contributions.

  • Reggie

    Not withstanding the systematic ineptitude of La Trobe management (by axing economics La Trobe’s business student numbers will fall even faster), this is a red flag for all economics departments at Australian universities.

    The disbanding of economics departments at UWS and now La Trobe reflects how economists have boxed themselves into a corner. Too much maths & stats that are overly complicated – in comparison to the elegance & predicative power of the maths used by biologists and epidemiologists for example. It is also too easy for students who are good at maths and stats to fall into Finance instead of Economics (this is why ‘finance’ is winning).

    Economics in Australia needs to be richer and more involved with other disciplines, from sociology to human biology – more accepting of a heterodox approach. It is only with a broader reach and deeper networks that economics depts will survive (making friends/alliances). The irony being that economists have chosen a strategy that’s not a Nash equilibrium ie. chasing the ‘best’ (think the blonde in ‘A beautiful mind’) when the equilibrium outcome is focusing on getting the ‘second best’.

    Economics depts need to get together and really think about radically changing their approach to economics and how economics relates to other social sciences. If economics keeps being snobbish everyone else is going to keep asking it to leave the party…

    Critically though, economics is one of the few disciplines that has the tools to keep politicians (& public servants/university administrators) honest – but everyone outside of economics either don’t realise or forgets this – one of the (many) reasons it is extremely important that economics is taught properly as a core discipline in universities.

  • Peter Rickwood

    @Reggie. My impression is that Australian economists don’t suffer from the same insularity as some of the North Americans, and there isn’t the same ‘snobbishness’ about the right way to do research/analysis. They seem by and large a non-partisan pragmatic lot (notwithstanding Ergas and a few others), and throwing out the basic economic framework/tradition (as you seem to be suggesting) wouldn’t serve anyone. Better to make best use of that framework/tradition, and be open about when the assumptions (and conclusions) are a bit rubbery. Could they be more honest about the shortcomings of their approach/tradition? Sure, but probably we all could: I dont see Australian economists as being particularly in error here.

  • IC

    The issues at La Trobe go far beyond the general direction of economics curriculum in recent years and the treatment of the Academics in the school is appalling, to say the least. The dismantling of the cap on places has driven even more students towards business degrees and their various specialisations (tourism/hospitality/sports management et. al). They have voted with their feet based on a decision for most made at the end of year 12 with no idea of the quality of the education they will receive nor the future benefits (or lack thereof). A Lemon’s problem. Economics has lost popularity at La Trobe because it is not ‘sexy’, nor is it ‘easy’. It is a discipline that requires some intellectual ability to succeed.

    As a student I have witnessed the emphasis (and marketing) being shifted away from economics and in to the business management degrees listed above. LTU revamped its Bachelor of Economics for 2014 and did sweet f.a. in terms of marketing it to potential students. The lack of consultation with students over the future of their courses is equally appalling, and it appears that if these large salary-drawing management types spent longer in academia before jumping onto the administrative wagon, perhaps sub-prime outcomes such as this would occur less often.

  • This is a great shame.

    Universities are crazy at the moment. I know someone who does online tutoring for OUA. They accept students who haven’t a chance of ever graduating. They tacitly encourage tutors to ignore plagiarism, by not paying tutors for the time and effort needed to follow the plagiarism policies.

    And of course if you are doing a course with the aim of getting a qualification in, say, “tourism management”, all you want is the piece of paper. You are probably working pretty well full time anyway, and actual study is a pain. So you’ll get students, universities and employers agreeing to make it a charade.

    Somewhere in the middle of this are the people who love their discipline and want to teach it properly.

  • Henry Haszler

    G’Day Harry

    I just heard the bad news via a forwarded email.

    I have a question. What happens if the Commonwealth Government’s proposed cuts don’t get up? As I understand it the new Senate may block the cuts, or were they included in legislation that has already passed?

    Good luck

  • hc

    Henry, These cuts provided additional reasons for these events but they were well in train before they were made.

  • Sturm_und_Drung

    As an economist, this story is fascinating to me. It is fascinating that there is no regulator of the actions of contemporary university managers. Those actions are, or ‘seem to be’, outside the public interest from time to time. Why wouldn’t they be?

    From TEQSA’s charter, one thinks that the issues falls within its charter but where does TEQSA fit here? I suspect nowhere.

    One would think universities could/should be required to operate in ‘the public interest’. It is an elusive concept and yet today’s universities may be governed by other notions eg ‘public perception’ or ‘assertion’ or ‘fads’. Even governed by ‘managed demand’, which is just another way of saying insiders fiddle with elasticities and gain market power via fiefdom.

    It appears to me university managers are empowered to operate outside the public interest and to thank the taxpayer for all their generosity. It that a surprising outcome?

  • Robert Waschik

    Like Harry, I work in the School of Economics at La Trobe. I have the course enrolment data for Economics and other courses here going back to 1990. There are two non-trivial errors in the article in The Australian.

    (i) in 1991, enrolment in the BEc was 434, not 930

    (ii) the sentence “La Trobe said the changes at economics were aimed at ensuring the sustainability of the discipline in the face of declining student enrolments” cannot possibly be correct, since economics enrolments have not fallen consistently … Using my enrolment data, if I run a regression of enrolments on time, with dummies and time-interacted dummies to control for the introduction of new couress like the Bachelors of Business and Finance in 1995, you find that enrolments in the BEc increased strongly from 1990 up to 1994. They then fell strongly after introduction of the BBus and BFin from 1995-1999. After introduction of the BEc/BAcc double degree program they continued to fall but at less than half the rate over the period 2000-2002. Since 2003, after introduction of the BIntBus, enrolment in the BEc has been roughly constant, increasing by .5 per year.

    This is ONLY the BEc – if you include the double-degree programs, the first of which was introduced in 1996, enrolment in Economics courses has been increasing.

  • An Observation


    CSP & Int’l funding is on a subject basis not course basis. What matters is enrolments in economics taught subjects. Have enrolments in economics taught subjects increased or decreased over time? This is important because you may find quite a lot of humanities students will take economics. If this is not the case at La Trobe then I think La Trobe has a cross-sell problem.

    This then raises the question of whether economics is a complimentary or substitution good. If it is a substitution good, then cutting economics will not have much effect on the rest of the business/humanities courses. If it is a complimentary good (as I suspect), then what is lost in economic course enrolments will probably be lost again (and possibly more) in the other business/humanities courses.

    La Trobe was traditionally the humanities university students choose in preference to Melbourne’s stuffiness. As mentioned by others, it going to be very hard for La Trobe to attract high ATAR students without a decent economics program. An ERA of 1 is not going to look good…

  • Alson

    In the web-site I see 27 (not 28 mentioned above) academics in the school of economics. Plus Trevor Kollmann seems to left to RMIT.

  • Robert Waschik

    Enrolments in ECO subjects at La Trobe have increased from 4500-5000 over the period ’97-’02 to over 7000 over the period ’10-’12. They have since fallen by about 1500 or so, but this is almost ENTIRELY due to the Faculty’s having taken the 1st year statistics subjects away from Economics and given them and their associated revenue to the School of Business.

  • An Observation

    Robert, thanks

    This is the story that needs to be told – that La Trobe economics is holding its own. Based on these figures, and having 28 staff, I would suspect that the economics department would have had a strong positive cash flow (ie. before management overheads which always remain independent of academic cuts). Seems to be a case of ‘cutting off the nose to spit the face’.

  • Peter

    I think we must learn from our history. This country is run by the elite with British support. The powers that be at LaTrobe (I mean the VC) must have hired a British Dean for the right reasons. This country in the past and still is run by the British and it still is a prosperous country. I think we must learn to give more weight to prosperity than to fairness. In this matter we can learn a lot from the first Australians. Even though they have been marginalised for many decades, they kept quiet and the country got rich because of the vision of our British Masters.

    More recently, the first Australians were subjected to intervention (NT intervention) and they silently allowed the management do its job with very little protest. I think the LaTrobe academics should be looking at these changes as an intervention for a greater good. Further, I think it is about time for the LaTrobe academics to tough it up in a manner that the first Australians have always demonstrated in the past.

  • hc

    You are probably right Peter. Its a failing on my part not to appropriately “tug the forelock”.

  • Ian Gould

    I am a B.Ec. graduate of LaTrobe (1991) and fobly remember Dr HC. Also Prof Langley, Maddock and Withers. It seems to me in the late 80’s and early 90’s that LaTrobe set out to put together world class academic staff. It’s very sad that LaTrobe no longer sees the value of economics.