Econtech Pty Ltd, trading as Independent Economics, is strongly committed to independent economic modelling that provides
robust analysis and real solutions for the economic analysis needs of industry clients.
Industry Services News (April 2012):
Modelling the Draft Basin Plan
Independent Economics (formerly Econtech Pty Ltd) was commissioned by the Murrumbidgee Valley Funding Partners to model
the economic impact of the Draft Basin Plan, which was released by the Murray-Darling Basin Authority (MDBA) in
November 2011. The Independent Economics report models the reductions in water use in the South West Murrumbidgee only.
MDBA documentation accompanying the draft Basin Plan shows water recovery for environmental purposes ('water savings') in the Murrumbidgee
of 29 per cent from a June 2009 base. The Independent report models two polar cases, one in which all water savings are achieved by government
water purchases, and the other where they are achieved by water infrastructure investment.
- Achieving the water savings in the Murrumbidgee through government water purchases leads to a quite small loss in national
living standards. This loss originates from the lost contribution of water to the value of production in the Murrumbidgee.
- Irrigated agriculture in the South West Murrumbidgee contracts in response to the government water
purchases. The loss in regional income leads to flow-on job losses in the regional services
- Real GDP in the South West Murrumbidgee is lower by a substantial 9 per cent. This is associated with a loss of
around 2,100 jobs.
- The modelling takes into account that some farmers are likely to leave the region, because reduced water availability means that they are better
off by moving. These farmers take the proceeds they receive from government water purchases with them. Realistic assumptions are made about the
limited extent to which farmers can raise their farm produce prices to offset the adverse impact of reduced water availability.
Independent Regional Water Model
To model the economic impact of government purchases of water entitlements, Independent Economics has constructed a
Computable General Equilibrium (CGE) model of the South West Murrumbidgee region and the rest of Australia
– the Independent Regional Water model.
Industry Services News (February 2012):
Building and Construction Productivity -
This fourth update of Econtech's seminal report on construction industry productivity was commissioned by Master Builders Australia. The first stage
of the update analyses the contribution of improved workpractices in driving construction industry productivity. The second stage
uses the findings of the first stage to estimate the flow-on benefits to the wider economy from the lift in construction industry productivity.
For this 2012 update, we have fully adjusted our 2008 update for the latest data. We have also cross-checked our results against the
2010 update report that was published by Master Builders Australia. Last, but not least, we have used a new economy-wide model.
Key Findings of the 2012 Update Report
- All the latest data continue to point to improved workplace practices leading to a significant productivity outperformance in the construction industry.
- The improved work practices are attributable to the activities of the Office of the Australian Building and
Construction Commissioner, its predecessor the Building Industry Taskforce and industrial relations reforms.
- Using the latest data, the estimated productivity gain ranges between 10 and 14.5 per cent, depending on the measure and the source of information that is used.
- This represents a strengthening in the productivity outperformance of the construction industry compared to previous annual updates.
- The flow-on benefits to the wider economy from this productivity outperformance include a lowering in construction costs faced by both the government and private sectors.
- This in turn flows through to mean that consumer prices and taxes are lower than would otherwise be the case, leading to a gain in
consumer real after-tax wages of 0.7 per cent.
- This is associated with a permanent annual gain in consumer welfare of $6.3 billion.
This modelling was undertaken using Independent Economics' Computable General Equilibrium (CGE) model.
The Independent CGE model is unique among Australian CGE models in distinguishing four sub-industries in the
construction industry (residential building, non-residential building, engineering construction and construction
Download the Construction Productivity Report
Download "Economic Analysis of Building
and Construction Industry Productivity: 2012 Report".
Our industry modelling of economic impacts of policies and projects in Australia uses our
Independent CGE model. Below, a
distinction is made between our general government policy modelling services, our tax modelling services, and our commercial services.
- "Economic Modelling of the Cost of
Presenteeism in Australia", Medibank Private, 2007.
- "The Economic Effects of Industrial Relations Reforms Since 1993", Australian Chamber of Commerce and Industry, 2007.
- "Economic Modelling of the Net Costs Associated with Non-Participation in Sport and Physical Activity", Medibank Private, 2007.
- "Economic Analysis of Dental Health for Older Australians", COTA Over50s and the Australian Dental Industry Association, 2007.
- "The Financial Impacts of Sustainability Risk Reporting on
Business and the Broader economy", FINSIA, 2007.
- "The Government's Retail Pricing Parity Policy and the Optimal Method for Charging Competitors for
Direct (ULL) Access to Telstra's Network", Telstra, 2006.
- "Analysis of the Trans-Pacific Flight Route", Singapore Airlines, 2005.
- "An Analysis of the Importance of the Current Reference Pricing System", Generic Medicines Industry
- "Easing the Pressure: The InterGenerational Report and Private Health Insurance", Medibank Private, 2004.
- "Model of Alcohol Taxation Scenarios for Vietnam", Diageo, 2007.
- "Analysis of Reforms to Tax Legislation Relating to Business Meals", Australian Hotels Association and Restaurant and
Catering Australia, 2005.
- "Estimating the Budget Cost of Changing the Tax Treatment of Planting Trees for Environmental Purposes", CO2 Group Limited, 2005.
- "Modelling Health Related Reforms to Taxation of Alcoholic Beverages", Alcohol and other Drugs Council of Australia, 2004.
- "Modelling Proposed Tax Reform of Employee Share Ownership Plans", Employee Ownership Group, 2004.
- "Modelling the Economic and Budget Impacts of Broadening the VCLP Program", Department of Industry, Tourism and Resources, 2003.
- "Economic Analysis of AVCAL's Proposed Venture Capital Investment Vehicle", Australian Venture Capital Association Limited, 2001.
- "The Effects of the New Tax System on Petrol Prices Under Different Excise Reductions", Australian Automobile Association, 2000.
- "Payroll Tax: Is it as Good as a VAT or as Bad as Sales Tax?", Australian Chamber of Commerce and Industry, 1998.
- "Productivity Gains from the Next G™ Network", Telstra, 2007.
- "An Analysis of the Future Fund using Central Portfolio Management (CPM)" (with David Gallagher), Vanguard Investments Pty Ltd, 2006.
- "The Economic Contribution of the Landing Helicopter Dock Program during the Construction
Phase of the Project", ADI Limited, 2006.
- "Research Report on Australia's Farm Dependent Economy", Australian Farm Institute, 2005.
- "Contribution of Exxon Mobil's Gippsland Operations to Gippsland, Victoria and Australia",
Esso Australia Pty Ltd, 2005.
- "The Workcase Tables: Residual Worklife in Australia 2000", Workcase Pty Ltd, 2000 and updated 2002.
For more information, email Chris Murphy or phone him at
Independent Economics on 02 6295 8884.
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