Times are good and getting better, economically. Professor Edward Prescott, Nobel laureate in economics (Nobel Memorial Prize in Economic Sciences) who is the co-recipient in 2004, visited Texas Tech University (TTU) recently and spoke about the importance of free enterprise. Along the way, he discussed the current global economic situation, in an event organised by TTU’s Free Market Institute.
The Nobel laureate predicted that there is no recession in sight and technological advancements are driving the growth situation. United States’ economy is booming stated Prescott. This has resulted in the shortage of skilled labor force, which is a positive news for the higher education sector. One factor that is enabling a higher growth is the recent lowering of U.S. corporate tax rate, which is good according to the Nobel prize winner.
East is catching up fast with the West and the tech capital they are developing will help them as well as the West added, Professor Prescott.
To a question from this scribe on the current trade war and tariff situation, Professor Prescott said, Presidents must do this sometimes to take care of national interests referring to President Johnson’s effort to protect the U.S. tire industry. He quipped to this scribe, guess what, President Lincoln was the greatest proponent of tariffs.
Joseph Heppert, TTU’s Vice President for Research and Innovation stated that visits by such acclaimed scientists motivates students and researchers and enable positive outcomes.
Having multiple business and manufacturing locations is an added advantage citing Wal Mart as a good example for having locations in Mexico and elsewhere. An important point that came out of the talk was that team production and resource allocation for the team’s efforts, as is currently practiced in big corporations, increase productivity and the wealth of nations. This is what happened in the late 1750s with the start of the industrial revolution, which wiped out the traditional way of doing businesses.
When knowledge becomes public, it is good, but Prescott cautioned “know your data.” The Nobel laureate advocated for decentralisation stating competition among entities likes states within a federal system is healthy, mentioning how Texas has been recently growing in population and economy.
His speech concluded with a message times are good and getting better.
By: Seshadri Ramkumar, Texas Tech University, USA