Vernon Smith: Self-Interest Reconsidered

Video Description

Stephen Blackwood speaks with the Nobel Laureate in Economic Sciences, Vernon L. Smith. They begin by defining and exploring commonly misunderstood economic terms—markets, capitalism, equilibrium—and then unpack the discoveries of Dr Smith’s pioneering experiments in economics, which—against widely held assumptions—revealed the operation of beneficence and non-zero-sum reciprocity at the heart of free exchange. ‘Self-interest’ is thus profoundly re-evaluated. Paradoxically, the only way to self-realization is through concern for others. Also, Vernon recommends for further reading, especially on the topic of his experimental games, which are described but not entirely comprehensible in the podcast, the following: Vernon L. Smith (1991) Papers in Experimental Economics. New York: Cambridge University Press. Writers and Writings Mentioned in this Episode Adam Smith, “The Wealth of Nations” (1776), Chapter 7 “Humanomics: Moral Sentiments and the Wealth of Nations for the Twenty-First Century” (2019), Vernon L. Smith and Bart J. Wilson “The Theory of Moral Sentiments” (1759), Adam Smith Parables of Jesus found in the Gospels Carl David Anderson (physicist) The Gospel of John, Chapter 1 C. S. Lewis’s Trilemma Links of Possible Interest: Humanomics: Moral Sentiments and the Wealth of Nations for the Twenty-First Century https://www.amazon.com/Humanomics-Sentiments-Twenty-First-Cambridge-Economics/dp/1316648818/ Dr Smith's Visitor Page at Ralston College https://www.ralston.ac/people/vernon-l-smith Ralston College http://ralston.ac Ralston College Short Courses https://www.ralston.ac/humanities-short-courses Stephen Blackwood https://www.stephenjblackwood.com/ Timeline 0:00 – Introduction 1:10 – The most misunderstood economic concept today 4:17 – Definitions: market and ideological equilibrium 10:24 – How markets work without central planning 13:31 – Maximum utility and Dr Smith’s experiments 16:03 – Inadequacy of term “free market” 18:08 – Why do some believe “capitalism” is the source of our ills? 27:59 – Human dignity and economic output 34:18 – Dr Smith’s experiments in behavioral economics 43:21 – Adam Smith’s Theory of Moral Sentiments and self-interest 58:21 – Beneficence and whether it can be coerced 1:07:48 – Non-zero reciprocity as the key to market success 1:19:14 – Invisible realities and the invisible hand 1:30:50 – Competition as a solution for higher education #RalstonCollege