The Gustavian Weekly

Lecture on economic growth given as part of philosophy and economics workshop: St. Olaf professor shares research on wealth and property rights | The Gustavian Weekly

By Emily VanGorder - Staff Writer | November 9, 2018 | News

From 4:40 to 5:30 p.m. on Thursday, November 13 in Beck 101, Professor Colin Harris will be presenting his paper, “Wealth Destroying Property Rights,” as part of a Philosophy, Politics, and Economics workshop created by Gustavus.

Professor Podemska-Mikluch arranged the lecture as part of the workshop, and chose Professor Harris because he “is an expert on the economics of property rights and the implications for economics growth and development.”

The event was geared towards “not only economics majors but also to any students interested in development and public policy,” as well as “anyone interested in public policy and economic development,” Podemska-Mikluch said.

“The goal of the lecture is to help students better understand the role of private property rights in an economy,” Podemska-Mikluch said.

Professor Colin Harris is the Tomson Family Assistant Professor of Law and Economics at St. Olaf, and has received a Ph.D in Economics from George Mason University.

Overall, his research is centered around the economics of property rights, development, and free enterprise.

His research has been featured in journals like World Development, Rationality and Society, and the Journal of Institutional Economics.

“The main thing I hope to communicate to college students is an appreciation for the economic way of thinking. Things are rarely black and white, and reform is never easy. The economic perspective asks us to consider both the trade-offs and constraints as we attempt to change the world for the better,” Harris said.

While most economists would advise people to secure their rights and prevent appropriation, and while it is true that these methods would go far in helping secure property rights, the question is how to achieve this outcome.

“And for this question, a greater sense of humility is needed… we know much less than we think we do… and it is much harder than we imagine to align incentives properly,” Harris said.

It is the belief of many that privatizing commons leads to an increase in wealth.

However, Harris argues that in numerous instances around the world, privatizing the commons has only led to a destruction of wealth.

A theory of wealth–destroying land privatization has been developed and applied to situations to analyze whether privatizing an asset leads to net gains or losses.

When people in charge of making decisions are residual claimants–agents who have sole claim over an enterprise’s cash flow, and receive whatever money is left over after everyone has been paid–the decisions can be made or influenced to benefit claimants at the expense of social wealth.

Professor Harris’ paper, “Wealth Destroying Private Property Rights,” centers around the idea that as distance increases between a decision-making authority and those whose livelihoods are jeopardized, the chance for something to go wrong increases.

Harris applies this theory to land privatization in Kajiado County, Kenya.

“There is a long history of land reform in Kenya involving the colonial government, independent government, and international development organizations… the once communally held land was demarcated and registered in the form of group ranches whose boundaries were based primarily on easy to identify terrain features rather than the boundaries traditionally recognized by the Maasai,” Harris said.

The group ranches limited the space needed for livestock production, and environmental and space limitations likewise imposed similar constraints on farming and other forms of alternate production.

Kenya ratified a new constitution in 2010, and there have been several new land acts passed since.

However, these new land acts have led to concern over whether they will truly be effective.

“The original idea for the theory was developed while working on my other research surrounding intellectual property rights,” Harris said.

After conferring with his co-author, Peter Leeson, the two decided that the argument would be more substantial if it could be used to support the claim that there are too many protections for intellectual properties.

Had environmental conditions, banking institutions, and political institutions been more fit and well-suited to the task, of privatization, the situation in Kenya could have been very different.

Harris adds that any differences between the situation in Kenya and in other locations can largely be attributed to the individual constraints present in each situation.

The goal of the workshop as a whole is to “broaden students’ understanding of ideas central to individual liberty, economic growth, and technological innovation,” according to the event’s page on the Gustavus website.

The workshop will conclude with a lecture from 4:30 to 5:30 p.m. on Tuesday, December 4 in Beck 101.

The lecture will be delivered by Ginny Choi, an Associate Director Director of Academic and Student Programs and a Senior Fellow in F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics.

She is also a Senior Research Fellow at George Mason University.

Choi has also earned a Ph.D. in Economics from George Mason University and a B.A. in Economics from Emory University.

Her lecture will center around whether friendships can survive contact with the market despite the morality issues and corruption often encountered.

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