A world leader in labour economics and econometric/statistical modelling research has been awarded a Federation Fellowship to conduct research at the University of Technology, Sydney (UTS) on major economic issues in health insurance, retirement planning and the adoption of new technologies.

Professor Michael Keane was today named as one of 24 Federation Fellows by Dr Brendan Nelson the Federal Minister for Education, Science and Training.

Professor Keane is one of the top economists in the world, a world leader in labour economics and a key player in modelling choices of consumers and organisations. He has made original, independent and pioneering contributions in econometric/statistical modelling, and more particularly in methods for estimating complex, dynamic choice models that take into account the evolution of markets, consumer expectations and experience. These contributions have received numerous citations from researchers in a number of fields, and have had a major impact on the way researchers think about modelling choices and decisions, and how choices and decisions are modelled.

Professor Keane comes to UTS from Yale University and was attracted to UTS because of the university's strength in financial economics, consumer choice modelling and health economics.

The fellowship will create a critical mass of researchers in choice modelling theory and methods in areas that Australia needs to sustain economic progress and plan for the future. It will significantly advance knowledge in several major areas: design of health insurance markets; tests for adverse selection in insurance markets; ability of people to plan for retirement (superannuation choices); ability of people to plan and choose in dynamic environments; and decisions to adopt new technologies/products in evolving technology markets. The outcomes will be new ways to understand and predict choices that can significantly improve practices in business and other organisations. A unifying theme underlying the proposed research program is the need to understand and model the different ways that individuals and groups make decisions.

Australian citizens and organisations make many complex choices that can have large immediate and future consequences that are uncertain and/or risky. Such choices not only impact current costs and/or returns, but also can impact future costs and payoffs in important areas like human capital formation, investments and savings, success/failure of new technologies/products, and health insurance ratings. The better researchers understand, and predict, how individuals make these choices and the short- and longer-term consequences of their choices, the better off society will be. Better knowledge and predictive capability should lead to more effective policies designed to impact choices, and better ways to evaluate their consequences. For example, in the case of health care policy, retirement planning policy, and provision of consumer products and services, governments should legislate/regulate to ensure a socially optimal minimum level of current investment, while also trying to provide individuals with choice options rather than "one size fits all" packages.

The proposed fellowship program will not only lead to more well-trained academics and practitioners, but will produce a critical mass of cross-disciplinary researchers who can advance the state of the art not only in Australia, but worldwide.

At UTS Professor Keane will work with the UTS Centre for the Study of Choice (CenSoC), the Centre for Health Economics Research and Evaluation (CHERE), and the Quantitative Finance Research Centre (QFRC).

The Federation Fellowships are managed by the Australian Research Council, are designed to attract and retain Australia's top researchers and to encourage international researchers to Australia to lead world-class research teams in work of strategic national benefit.