Dr. Peter Varela

that you can do that are all sort of pushing in the right direction.

I think it's just a question of how grand those reforms are going to be, whether they're the kind of narrow cleanup of the points test or whether they're the sort of more sort of ambitious, how do we use points test reform to help the student pathway sort of start to make sense.

One of the things that we sort of did in our work was make the case, and I think we made the case fairly strongly, that the points test is trying to use one instrument to apply to two different groups.

There is a group of migrants going through the points-tested system that are not working in the Australian labour market.

They might be offshore or they might be recent Australian graduates.

who've just graduated from an Australian university.

And then there are people who are working in the Australian labor market.

And the case that we were making is that you actually want to think about these two groups very differently.

The information that you require to sort of predict long-term outcomes of someone who is currently already working in Australia is a very different information set.

Now, our solution that we put forward in the paper was essentially just to use age and income of people working in the Australian labour market.

It's a very clean economist's answer to that solution, but the deeper insight that you should think differently about people already here working and those that aren't, I think is the key.

And there's lots of different ways that you can approach that question.

And again,

Most of them would be improvements to the current system.

So lots of different ways to improve the system.

Yeah, so we run a selective migration program.

We like it when migrants come to Australia, earn money and work in high paid jobs.

This is good for migrants.

Migrants are obviously happier if they earn money, but it's also sort of good for the broader economy.

It sort of shows up in headline productivity if migrants are working in high paid jobs.