Ian Macfarlane

Why former Reserve Bank Governor Ian Macfarlane chose Monash to study Economics 

In 1964 a bright young man from Melbourne High School strode through the new halls of Monash University at Clayton.

Little did 17-year-old Ian Macfarlane know, as he began his Bachelor of Economics degree in the 60s, that he and a number of his fellow students would go on to play crucial roles in chartering Australia’s economy through the turbulent decades of the 1980s through to the  2000s.

Just three years earlier, the first clay sod had been turned at the Clayton campus by Premier Henry Bolte. From then on, free from the constraints of tradition, the University’s young minds – students and academics alike – were keen to push the frontiers of learning and break from convention.

“My high school economics teacher had said it offered the best undergraduate degree in Australia,” Mr Macfarlane recalls of making his decision about where to establish his tertiary studies.

Ian Macfarlane, AC.

“It had a young enthusiastic faculty, and the Dean, Professor Donald Cochrane, was a brilliant administrator. Within a relatively short period, he had created seven professorships, seven chairs of Economics in the faculty, and that was unheard of at the time.”

He remembers “a Cochrane rule” that staff couldn’t get economics lectureships at Monash without first gaining exposure and experience further afield - preferably overseas.

“Monash felt like a much more interesting place than The University of Melbourne, which at the time had a much older staff. Cochrane had brought over some of his best people from (his previous employer The University of Melbourne), while other teachers in the Faculty were generally younger economists with overseas qualifications.”

Monash was much better resourced, much younger, and students could better identify with some of the staff, Mr Macfarlane says.

“I got to know some of the lecturers quite well - a couple would go to the Notting Hill (Hotel) and have a drink with you. There was more interaction between staff and students.”

Mr Macfarlane’s Economics undergraduate studies kick-started what became an illustrious career. At its peak he spent a decade (1996 - 2006) as Governor of the Reserve Bank of Australia, steering the nation through the Asian financial crisis in 1997 and the global recession of 2001. In 2004, he was made Companion of the Order of Australia (AC).

"These two years were the highlight of my six-year Monash experience - there was a lot of energy and frequent international visitors of high academic repute."

There were many familiar faces from his Monash student days in those annals of power in Canberra and Sydney, he says, explaining that at one stage “it was like the entire government economic infrastructure was run by Monash graduates”.

“I was ex-Monash, Treasurer Peter Costello was ex-Monash, Head of (corporate regulator) ACCC Graeme Samuel was ex-Monash, and Gary Banks, the Head of the Productivity Commission, was ex-Monash.”

His recollection of the Clayton campus itself in the 1960s, was of an institution very much in the making.

“There was a lot of building activity going on, a lot of high wind and a lot of mud,” Mr Macfarlane says.

“Monash was called ‘The Farm’, and The University of Melbourne was called ‘The Shop’.”

“Monash was small and new; its students were proud of the place. They did not feel they were playing second fiddle to Melbourne.”

After completing his Honours degree in 1968, he accepted a two-year teaching fellow position, while completing a part-time Masters degree.

Ian Macfarlane (right) with wife Heather, accepting his honorary Doctorate of Law from Vice Chancellor Professor Richard Larkins and Deputy Chancellor Dr Leanne Rowe.

“These two years were the highlight of my six-year Monash experience - there was a lot of energy and frequent international visitors of high academic repute,” Mr Macfarlane says.

Work took him overseas and then to Sydney after leaving Monash, so he did not stay closely in touch with former classmates - although still sees some from time to time, sharing the occasional meal.

“I look back and a lot of them did very well,” he says, recalling Professor Peter Dixon, AO (Economics, Victoria University), Professor Glen Withers (Economics, ANU), Professor Ron Bird (Finance, ANU), Rob Jolly (former Victorian Treasurer) and George Pappas (former Chancellor, Victoria University).

In 2019 Mr Macfarlane joined the Industry Advisory Board for a new Bachelor of Politics, Philosophy and Economics, run jointly by the Faculty of Arts and Monash Business School, and served as a founding member until May 2021. He received a Distinguished Alumni Award in 1996, and an Honorary Doctorate of Law in 2007.

Asked about his advice for current economics students, Mr Macfarlane says while the quantitative element is important (he studied statistics for three years), he feels “people now tend to over-emphasise the maths”.

“I think early on in your degree, there’s a lot to be said for studying other things like politics and philosophy,” he says.

Monash Business School proudly continues that tradition of innovation and holistic learning to shape the economists and business leaders of the future.