Wayne A. Leighton & Edward J. López

Madmen, Intellectuals, & Academic Scribblers

The Economic Engine of Political Change

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Edward J. López

Edward J. Lopez is Professor of Economics, BB&T Distinguished Professor of Capitalism, and Director, Center for the Study of Free Enterprise at Western Carolina University, where he teaches classes in macroeconomics, applied business economics, and the moral foundations of capitalism. He previously taught public choice and economics of intellectual property at San Jose State University.

Edward is the Executive Director and Past President of the Public Choice Society, an international, inter-disciplinary association of collective action scholars that celebrated its 50th anniversary in March, 2013. He is also Past President of the Association of Private Enterprise Education and Regional Editor for the Americas of the Journal of Entrepreneurship & Public Policy. He is the founding director of the Center for the Study of Free Enterprise, which supports joint student-faculty research projects and policy analyses on economic development topics.

Edward’s research focuses on the economics of ideas, entrepreneurship, and politics. His early papers build theoretical and empirical models of institutional change, mostly by studying political entrepreneurship and federal-state voting patterns in the United States. His more recent work tightens focus on the influence of ideas and interests in shaping institutional arrangements. His first book is an edited volume that uses public choice theory to study how the legal system actually works in practice, and to recommend beneficial reforms in civil and criminal law (The Pursuit of Justice: Law and Economics of Legal InstitutionsPalgrave Macmillan, 2010). Edward’s second book, co-authored with Wayne A. Leighton, is Madmen, Intellectuals and Academic Scribblers: The Economic Engine of Political Change (Stanford University Press 2013). Amazon reviewers have described Madmen as “insanely well written”, “a brilliant, clear description”, and “completely addicting to read”. In May 2016, a Chinese translation of Madmen was released by China Financial Publishing House. Edward’s more than 50 scholarly papers have appeared in outlets such as Public Choice, Journal of Institutional Economics, Review of Law & Economics, Review of Austrian Economics, Southern Economic Journal, Political Research Quarterly, Social Science Quarterly, Eastern Economic Journal, and more.

On campus Edward has served as the convener of the Council of Distinguished Professors (2013-2015), chair of the search committee for Gimelstob-Landry Distinguished Professor in Economic Development (2015, 2016), and committee member on Vice Chancellor Development & Alumni Affairs search (2016), Vice Chancellor for Administration & Finance search (2014), University Collegial Review (2014-15, 2016-17), Economics Faculty search (2015-16), School of Economics, Management and Project Management Collegial Review (2015-16, 16-17), Chancellor’s Honorary Doctorate selection (2013), and College of Business Curriculum (2012-14).

Outside academia, Edward has worked as a staff economist for the Joint Economic Committee of the U.S. Congress, as manager of policymaker education for the Mercatus Center, and as economics program officer at the Institute for Humane Studies. In 2001 he was a visiting scholar at the Center for the Study of Public Choice, in 2007-08 he was a Resident Scholar at Liberty Fund, Inc., and in 2010 he was a Visiting Scholar at the Social Philosophy & Policy Center.

Edward is a frequent speaker at professional conferences, on college campuses, and before business and community groups. A native of San Antonio, Texas, he has lived in Washington, D.C., Dallas/Fort Worth, Indianapolis, San Francisco, and San Jose. He now resides with his wife and two young children in Asheville, North Carolina.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.189, ch.7)

The most successful entrepreneurs know what they do well, they know the market and the opportunities within it, and they choose those activities that create the most value. This is true in economic as well as political markets.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.178, ch.7)

[W]hen the right elements come together at the right time and place and overwhelm the status quo, it is because special people make it happen. We call them political entrepreneurs.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.176. ch.7)

While we started this book with Danny Biasone saving basketball, we end it with Norman Borlaug saving a billion lives. These stories are not that different. Both faced vested interests, which were reinforced by popular beliefs that things should be a certain way—that is, until a better idea came along.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.174, ch.6)

Because there was a general belief that homeownership was a good thing, politicians found the public with open arms.... Everybody was winning—except Alfred Marshall, whose supply and demand curves were difficult to see through the haze of excitement at the time, and except Friedrich Hayek, whose competition as a discovery procedure was befuddled... In short, once politicians started getting credit for homeownership rates, the housing market was doomed.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.166, ch.6)

Everyone responded rationally to the incentives before them. In short, the rules that guided homeownership changed over time, which in turn changed the incentives of these actors. And bad things happened.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.153, ch.6)

They understood the economics. The ideas had already won in ... the regulatory agency itself. All that remained to be overcome were some vested interests and a handful of madmen in authority.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.146, ch.6)

If the idea for auctions of spectrum use rights had been part of the public debate since at least 1959, why didn’t the relevant institutions change sooner? What interests stood in the way?

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.121, ch.5)

When an academic scribbler comes up with a new idea, it has to resonate well with widely shared beliefs, which in turn must overcome the vested interests at the table. Many forces come together to explain political change, even though it may seem like coincidence of time and place.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.120, ch.5)

It’s the rules of the political game that deserve our focus, not politicians’ personalities or party affiliations.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.119, ch.5)

In short, ideas are a type of higher-order capital in society. Like a society that is poor in capital and therefore produces little consumer value, a society that is poor in ideas and institutions will have bad incentives and therefore few of the desirable outcomes that people want.

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