Colonel Harwood’s Principles Ring True Today – American Institute for Economic Research (blog)

In 2018, AIER will celebrate its 85th anniversary. While the institute has evolved with changing times and technology, there are certain bedrock principles on which we rest that date as far back as our founding by Colonel E.C. Harwood in 1933. AIER After 75 Years, published almost a decade ago at the 75th anniversary, contains a clear statement of many of those principles.

One of Harwoods core principles was adherence to the scientific method, which much of the field of economics has neglected. Scientific economists should begin with observation, not predetermined opinions:

Scientific economists seek to ascertain and describe a wide variety of relationships, including socio-political relationships, that influence economic events. While doing so, they also seek to identify those human arrangements that tend to foster progress or regress in social welfare, where progress is described broadly by increases in standards of living, human longevity, and the increased satisfaction of human wants and needs.

These observations have led to the conclusion that free markets and strong legal protection of property rights are the best way to promote social progress:

Rather, what seem chiefly to have distinguished the experience of the United States were greater individual freedom and a legal structure that preserved individual property rights, both of which evidently promote rapid economic progress in a number of ways.

Increased productivity is encouraged, offering greater reward to those who better serve their fellows. This benefits society by making available to everyone, in proportion to their like contributions to output, more of the things that their fellow humans indicate they want.

In order to reap the full benefits of such a system, government must have a well-defined but limited role:

A society based on property rights and open markets implies a limited role for government, inasmuch as history records that more people have been oppressed through the mechanism of government than through any other device. This is not to say that government has no legitimate role; quite the contrary. Our Constitution sets forth clear tasks for government, which can be summarized as the protection of freedom and justice from thosedomestic or foreignwho would deny them.

In summary, the system should work toward providing and protecting a fair field with no favor in which each individuals freedom is restricted only as necessary to protect the equal freedom of others. This would appear to be a useful gauge by which to assess the probability that specific laws will foster progress or regress of the social order.

The essay goes on to describe the ways that governments, even when well-intentioned, act to restrict markets and impede competition. The whole piece is well worth reading, as a document of the institutes past work and ongoing positions, as well as useful information about our history and bylaws. As we move into our anniversary year, we will keep working to produce research that both reflects current issues and adheres to the core principles of our history.

You can find "AIER After 75 Years" here.

Link:
Colonel Harwood's Principles Ring True Today - American Institute for Economic Research (blog)