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Dr. Vernon L. Smith - George L. Argyros Endowed Chair in Finance and Economics at Chapman University
2002 Recipient of the Nobel Memorial Prize in Economic Sciences
The Free Market Institute and the Jerry S. Rawls College of Business Administration co-hosted a public lecture with Dr. Vernon L. Smith, who is the 2002 co-recipient of the Nobel Memorial Prize in Economic Sciences "for having established laboratory experiments as a tool in empirical analysis, especially in the study of alternative market mechanisms." Dr. Smith's presentation was based on his research in experimental economics on asset bubbes and empirical research for his co-authored volume (with Steven Gjerstad), Rethinking Housing Bubbles: The Role of Household and Bank Balance Sheets in Modeling Economic Cycles (Cambridge University Press). Dr. Smith argued that the empirical evidence demonstrates that - with relatively few exceptions - household and bank balance sheet crises, driven by speculative bubbles in housing finance and construction industries, have been the primary drivers of the business cycle in the United States from the Great Depression through the Great Recession of 2007-2008. Dr. Smith provided historical examples - from the United States and other countries - of how activist monetary and fiscal policy and adherence to the notion of "too big too fail" have exacerbated problems associated with household and bank balance sheet crises.
A Weekend Seminar Presented by Free Market Institute (Texas Tech University) and Institute for Humane Studies (George Mason University)
The Free Market Institute (FMI) and the Institute for Humane Studies (IHS) co-hosted an On-Campus Education program, Liberty Applied: Current Events and Controversies. IHS On-Campus Education programs examine the historical, economic and philosophical foundations of a free society and how these principles apply to contemporary issues. The program brings together undergraduates and recent graduates for an introduction to classical liberal ideas through an informative and enjoyable collection of lectures, discussions and evening socials.
Dr. David B. Skarbek - Lecturer in Political Economy, King's College London
The Free Market Institute hosted Dr. David Skarbek to discuss his research addressing the history, function and purpose of prison gangs in the United States penal system. His research explains why prison gangs did not emerge as a regular part of the penal system until the second half of the 20th century. Prior to the emergence of prison gangs, informal reputational norms provided the dominant form of governance among prisoners. As inmate populations increased dramatically in the second half of the 20th century, prison gangs emerged as the primary form of governance in state prisons in California. Prison gangs primarily provide security in instances where formal protection is inadequate and decrease transaction costs for illicit exchange. Dr. Skarbek drew on research related to rational choice theory and new institutional economics to make a compelling case that prison gangs, while extralegal and having to rely on violence as an enforcement mechanism, produce positive benefits for members and have been instrumental in lowering overall levels of violence and producing sustained order in the penal system. Dr. Skarbek's research has broader implications for scholars seeking to understand how individuals in situations where they lack freedom, resources and effective political rights can nevertheless organize to overcome these difficulties and gain benefits from coordinated cooperation.
Dr. Andrew T. Young - Associate Professor of Economics and BB&T Scholar at West Virginia University
The Free Market Institute hosted Dr. Andrew Young to discuss his ongoing research efforts that examine the impact of increased worldwide internet access on comparative institutional quality. Dr. Young cited research that demonstrates the impact that institutional quality has in producing beneficial economic outcomes related to income and a host of other indicators of wealth. The vast increase in worldwide internet access over the last 15-20 years has largely been driven by vast increases in wealth that are the result of general improvements in institutional quality that promote greater economic freedom. The emergence of the internet as a widely-used communications medium has fundamentally changed the quantity and quality of information that individuals access about the quality of life in other places throughout the world. This increase in the availability of information has dramatically expanded the potential for institutional spillovers to develop. Additionally, individuals are hardwired to express empathy in response to their observance of hardship in other places. In wealthy countries, the propensity for empathy can create demands for deliberate political efforts to alleviate those hardships, such as through the provision of foreign aid programs. Demands for increased foreign aid create a paradox in developing nations where the well-intentioned efforts of wealthier nations actually serve to retard the process of institutional change that produces economic development. In effect, increased worlwide internet access is a consequence of growing wealth that results from improvements in instutional quality. However, the enhanced ability to understand the plight of indviduals in developing nations can create demands for developed nations to institute policies that slow the wealth-generating process in developing areas of the world.
The Role of Government in a Free SocietyDr. Walter E. Williams - John M. Olin Distinguished Professor of Economics at George Mason University
The Free Market Institute and the Office of the Chancellor of the Texas Tech University System hosted world-famous economist and nationally syndicated columnist, Dr. Walter E. Williams. The event drew over 800 attendees from the Texas Tech University and broader Lubbock communities. Dr. Williams discussed the ideal role of government in a free society in light of constitutional principles, the major writings and statements of the Founding Fathers and current trends in political economy. Dr. Williams highlighted the net benefits provided by institutional rules that safeguard the integrity of contracts and justly acquired private property, promote voluntary exchange in the marketplace, provide for relatively free trade both domestically and internationally and ensure a limited scope for regulatory restrictions and redistribution of wealth by political authorities.
Michael D. Tanner -Senior Fellow, Cato Institute
Dr. Peter H. Lindert -Distinguished Professor of Economics, University of California at Davis
The Institute for the Study of Western Civilization and the Free Market Institute at Texas Tech University co-hosted a debate about the future economic feasibility and sustainability of the modern western welfare state. Michael Tanner argued that massive unfunded liabilities driven by demographic changes will mitigate against any possible economic feasibility of US government social spending programs in the long run. Dr. Peter H. Lindert recognized the significance of demographic changes as drivers of the long-run cost of government social spending programs. However, if properly defined and modified to cope with the problems of demographic change, wealthy western states will be able to indefinitely afford and provide government social spending programs. Both participants recognized a fundamental need for structural changes of social spending programs, but disagreed on the long-term economic feasibility of such programs.
Dr. Thomas E. Woods, Jr.
The Texas Tech Catholic Students Association, the Free Market Institute and the Leadership Institute hosted New York Times bestselling author, Dr. Thomas, E. Woods for a lecture discussing fundamental economic principles and their consistency with the tenets of Catholic Social Teaching. Dr. Woods cited several examples of papal declarations on issues related to economic issues and social justice. In each case, he carefully explained the issue at hand and whether the official Church perspective comported with economic logic and evidence from historical experience. In some cases, the moral imperatives laid out for Catholics in these papal declarations bolstered institutions that create lasting and wide-shared prosperity. In other cases, they have flown in the face of economic logic and, in the long run, have undermined the concern for material and spiritual improvement in the lives of the poor. Dr. Woods laid out a case for recognizing and promoting the moral imperative of "the preferential option for the poor" as being manifest in the institutions of private property, the rule of law and the market economy.
Dr. Peter Leeson, Professor of Economics and BB&T Professor for the Study of Capitalism at George Mason University
The Free Market Institute and the Department of Political Science at Texas Tech University hosted Dr. Peter T. Leeson for a lecture discussing his research on the law and economics of early eighteenth century piracy. The lecture focused primarily on material from his book, The Invisible Hook: The Hidden Economics of Pirates (Princeton University Press, 2009). Dr. Leeson highlighted the establishment of radical democratic constitutions as the primary form of governance aboard pirate ships. He also discussed various economic propositions and theories including rational choice theory, the principal-agent problem, the theory of signaling and credible commitments in the context of pirate curiosities such as the use of "pirate codes," the "jolly roger" and pirate torture. Dr. Leeson's conclusions indicate that pirates practices, while criminal and violent, were not the product of an irrational pursuit of violence and crime for its own sake. Rather, pirate customs and law were a rational, profit-motivated response to prevailing economic conditions aimed at maximizing booty and, in some ways, these practices predated and influenced the evolution of similar institutions under democracy as administered by the nation state.
Dr. Robert A. Lawson, O'Neil Center for Global Markets and Freedom, Cox School of Business, Southern Methodist University
The Free Market Institute officially launched in early March with a public lecture by Dr. Robert A. Lawson. Dr. Lawson is co-author of the widely-cited Economic Freedom of the World Annual Report (Fraser Institute), which produces an index of economic freedom for over 140 countries. Dr. Lawson's lecture provided a brief overview of the history and methodology of Economic Freedom of the World Annual Report. The lecture focused particularly on the recent decline of the United States' rankings in the index with connections to recent and ongoing public policy issues. Dr. Benjamin Powell, Director of the Free Market Institute, offered introductory remarks about the Economic Freedom Project and the mission and vision of the Free Market Institute at Texas Tech University.