Political Entrepreneurs

The Economic Engine of Political Change

Category: Intellectuals in Action

A Nice Example of Creative Destruction and the Market Process: The Decline of Newspapers

February 24th, 2017 by Edward Lopez

Initially written as “The Decline of Newspapers is a Sign of Market Success” for Info Tech & Telecom News, July 2010, by Edward J. López[1] The decline of newspapers is real. Since 1970 the number of dailies in America has declined by 20 percent, and circulation per capita has been cut in half.[2] More recently, advertising on news print is down 50 percent since peaking in the year 2000. Even including the more recent stream…
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Celebrating Norman E. Borlaug

March 25th, 2016 by Edward Lopez

Today would have been Norman E. Borlaug’s 102nd birthday. He died in 2009 after an enormously productive life of helping others to help themselves. Known as the “father of the Green Revolution” for introducing high-yield wheat varieties to impoverished economies, his work was recognized with a Nobel Peace Prize among other awards for “the man who saved a billion lives”. I like the photo here because it evokes the academic scribbler side of his entrepreneurship but also…
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Spotted: Political Change Analysis on the Streets of San Francisco

December 8th, 2014 by Edward Lopez

A delightful story , “Our night as an Uber driver — Using a $500,000 Rolls-Royce,” appears in the current issue of Car and Driver. One passage, in particular, reveals that the writer may have read Madmen. Either that, or the writer has arrived at sound public choice and political change analysis through reasoned examination: In Uber’s mind, the company is Doing Good. In the eyes of the cabbies, their lunch is being eaten by a bunch of amateurs not subject…
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Why We Need the Madmen in Authority

July 31st, 2014 by Edward Lopez

Did you know that Oklahoma is ranked 28th in population but in 2011 had one of the nation’s largest unfunded pension liabilities? The Reason Foundation’s Pension Reform Newletter carries  an interview  with Oklahoma state legislator Randy McDaniel, who explains: OPERS is the state’s second largest retirement system. In 2010, the system had a $3.3 billion unfunded liability, … The big picture is the state had over $16 billion in total unfunded liabilities. In a reform process entering its fifth…
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Engaging Students Through Op-Ed Writing Assignments

June 30th, 2014 by Todd Nesbit

As much as I and many other economists at teaching institutions take pride is having former undergraduate students go on to earn their PhD in economics and enjoy the “family” photos at professional conferences, the vast majority of students with which we interact will go on to pursue other professions.  This certainly suggests that we academic economists should not evaluate our success purely–or even mostly–as a function of students who go on to earn their…
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Why Publishers Weekly Should Look Into How the Dismal Science Got its Name

April 20th, 2014 by Edward Lopez

The reviewer for Publishers Weekly did not like Madmen, Intellectuals, and Academic Scribblers. Annoyed evidently with the fact of economics — it’s very existence — the (anonymous) reviewer twice associates Madmen with “the dismal science,” hoping the reader shares every negative and objectionable connotation the reviewer seems to cast on that association. Madmen, we’re told, is dismal because it is a work of economics, because it is a difficult read, and because it recounts the life and works of “unheralded”…
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Free Enterprise on a Massive Scale: The 2014 APEE Meetings

April 18th, 2014 by Edward Lopez

The Association of Private Enterprise Education is alive and well. This year’s conference was held earlier this week at The Wynn Las Vegas and was attended by about 530 scholars, practitioners, and students from 12 countries. It was the largest attendance in the Associations 39-year history. To put that in perspective, my notes say that the 2001 meeting in Washington, DC, was attended by 142, and the 2000 meeting at Caesar’s Palace Las Vegas drew attendance of 206. So APEE…
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Why Jon Stewart Should Read Buchanan and Wagner not just Zingales, Stiglitz, and Lessig

February 13th, 2014 by Edward Lopez

“Intellectuals” are middlemen of ideas. They influence the world views of large numbers of people, both in designed and spontaneous ways. In general, we can say that people’s worldviews affect their positions about the proper role and scope of government. So when people’s worldviews change, this in turn can be an impetus to political change. Video as a medium of communication, be it film or television or YouTube or other, is a powerful tool for the…
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Ronald Coase (1910-2013): He kept his hands dirty

September 3rd, 2013 by Edward Lopez

The news has spread quickly that Ronald Coase has passed away at the age of 102. The list of his fundamental contributions to human understanding runs long, as did his career. Just last year he published a book on capitalism in China (discussion here and here ). He is most famous for the “Coase Theorem,” which is fairly easy to grasp at a superficial level but is quite rich and nuanced at deeper levels. For this reason, the idea is often…
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New Memorials of Jim Buchanan

August 18th, 2013 by Edward Lopez

Some noteworthy memorials have been published since my last post on memorials to Jim Buchanan . Perhaps most noteworthy are Geoff Brennan’s in Public Choice and Bob Tollison’s in the Southern Economic Journal . Links to both are gated, but most of the Brennan piece can be browsed free of charge. Both offer somewhat personal reflections. Geoff talks about Buchanan’s normative use of the word “optimal” — with reference to his own death — and how Buchanan wasn’t one to revise and keep coming back to prior works. Instead, he would just put it out…
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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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