New York, NY, November 12, 2010 --(PR.com
)-- The Institute for New Economic Thinking (INET), launched with a $50 million pledge from George Soros to promote changes in economic theory and practice through research grants, Task Force groups, academic partnerships, and conferences, announced that it has selected William Lazonick of Academic-Industry Research Network (theAIRnet) to be awarded a project grant through the Institute’s Inaugural Grant Program to analyze the ways in which an important financial institution – the stock market—affects the real economic performance of the industrial corporations that are listed on it. The grant program, along with other INET initiatives, was created in direct response to arguably the worst economic crisis in world history, and has been designed to encourage and support new economic thinking. Starting in 2011, INET will conduct two grant cycles annually.
The theory of innovative enterprise provides the foundation for a critique of the prevailing ideology that, through the “maximization of shareholder value,” corporate resource allocation contributes to the superior performance of the economy as a whole. Through the research project, Professor Lazonick plans to use INET’s funding to further the understanding of the interaction of corporate resource allocation decisions and stock-price movements, and thereby shed light on economic perspectives on the stock market such as the efficient market hypothesis, behavioral finance, information asymmetries, and financial instability.
"William Lazonick's active engagement with European scholars, Asian scholars and the field of institutional economics gives him a true understanding of both economic history and contemporary challenges of real companies and real institutions," said Dr. Robert Johnson, Executive Director of INET. "His work is among the most exciting practices of applied economics taking place today."
William Lazonick chairs the Academic-Industry Research Network. He is a professor at UMass Lowell, where he directs the Center for Industrial Competitiveness. Previously, Lazonick was Assistant and Associate Professor of Economics at Harvard University (1975-1984); Professor of Economics at Barnard College, Columbia University (1985-1993): and Distinguished Research Professor at INSEAD (1996-2007). His academic degrees are B.Com, Toronto (1968); MSc (Econ), London School of Economics (1969); PhD (Econ), Harvard (1975); and PhD (honorary), Uppsala (1991). His latest book, Sustainable Prosperity in the New Economy? Business Organization and High-Tech Employment in the United States (Upjohn Institute 2009) has been awarded the 2010 Schumpeter Prize.
“Both the stock market and innovation are central to the way in which a capitalist economy operates,” says Bill Lazonick, chair of the Academic-Industry Research Network. “Yet almost all academic work on the stock market has ignored its influence on the innovative capabilities of the business enterprises on which we rely for productivity and jobs. This project with the funds from INET will analyze the ways in which the stock market can be regulated to promote rather than undermine the innovation process.”
INET’s Inaugural Grant Program has been designed to harness the new economic thinking they recognize as crucial to effecting change. The program was launched this summer and received more than 500 applications from around the world and has selected 31 initiatives to be awarded grants totaling $7 million. INET's Grant Program will continue with two similar grant cycles annually, the next one commencing in the spring of 2011.
For further details regarding INET’s Grant Program or additional projects and people to be awarded grants please visit the Institute’s website.
About the Institute for New Economic Thinking:
Launched in October 2009 with a $50 million commitment from George Soros and driven by the global financial crisis, the Institute for New Economic Thinking (INET) is dedicated to empowering and supporting the next generation of economists and scholars in related fields through research grants, Task Force groups, academic partnerships, and conferences. INET embraces the professional responsibility to think beyond current paradigms. Ultimately, INET is committed to broadening and accelerating the development of innovative thinking that can lead to insights into and solutions for the great challenges of the 21st century and return economics to its core mission of guiding and protecting society. For more information please visit http://www.ineteconomics.org/