Daniel J. Smith's research while affiliated with Middle Tennessee State University and other places

This special issue brings together the papers presented and discussed at the Harold A. Black Academic Conference hosted by the Probasco Distinguished Chair of Free Enterprise at the University of Tennessee, Chattanooga, the Haslam College of Business at the University of Tennessee, Knoxville, and the Political Economy Research Institute at Middle Tennessee State University. Dr. Black is an emeritus professor of finance at the Haslam College of Business at the University of Tennessee, Knoxville, and has had a distinguished career advancing our understanding of race and discrimination in banking and finance. More specifically, throughout his career, Dr. Black undertook in-depth empirical studies that examined the institutional details of statistically observed disparate outcomes in banking and finance to determine whether these outcomes were attributable to discrimination or could be explained by non-discriminatory factors. In some instances, Dr. Black found that addressing disparate outcomes with inappropriate policies could result in perverse consequences that harmed the intended beneficiaries. This introduction explores the relationship between Harold Black’s work, the papers in this special issue examining, building on, and extending Harold Black’s work, and public choice economics.

Was there legitimate public interest justification for regulating whiskey with the Pure Food and Drugs Act of 1906? High and Coppin (Bus Hist Rev 62:286–309, 1988) provide evidence for a public choice interpretation of the application of the act to the whiskey industry. However, the existence of public choice factors does not preclude the simultaneous existence of genuine public interest rationales. The public interest justification was that rectifiers, who flavored neutral spirits to replicate straight whiskey, commonly adulterated whiskey with poisonous ingredients. We examine these claims using alcohol consumption data, chemical tests of whiskey, trade book recipes, and reported deaths and poisonings from whiskey. We find that poisons were infrequently used in rectified whiskey and that the poisons used were overwhelmingly either not fully understood to be dangerous at that time or were demanded in underground markets. The historical evidence bolsters the public choice interpretation of High and Coppin (1988).

What is the relevancy of modern Austrian economics? Austrian economics, from its origins, has attempted to push economics towards greater relevance by developing and refining a methodological approach that enhances the operational validity of its scientific conclusions for decision-making in the real world. In a theoretical paradigm, this led to the development of theoretical insights on significant economic phenomena often excluded from static economics models. As the economics profession took an empirical turn, modern Austrian economics has demonstrated its continued relevancy through empirical methods that apply economic theory to pressing, long-standing policy issues.

Is everything good in political economy incorporated into modern graduate education in economics? With the transition of the art of political economy into the science of economics, there was a significant narrowing of graduate education curriculum. The prevailing technique in economics, a neoclassical framework focusing on formal empirics, gradually compressed artistic components of economics, including philosophical underpinnings, democratic justifiability, theoretical intuition, comparative institutional analysis, and political economy. Courses on the history of economic thought, which historically played a role in introducing graduate students to the complexities of the art of political economy, are now only offered as an elective. This paper argues, however, that there are still insights to be gleaned from studying the classics of political economy in graduate education. We highlight the tradeoff between theoretical cumulativeness and knowledge, arguing that significant insights from historical works of political economy are often absent in contemporary technical expositions of economics. We explore examples of useful knowledge in political economy that was lost in the transition away from the art of political economy. To remain an operationally valid social science, economists should reintroduce the artistic elements of political economy into the graduate training of economists.