It's important for young people to get involved with economy

Anthony J. Evans, associate professor of economics at ESCP Europe Business School, gave a lecture at the Faculty of Political Sciences on th...

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Anthony J. Evans, associate professor of economics at ESCP Europe Business School, gave a lecture at the Faculty of Political Sciences on the Austrian Economics. As one of the few economists of the Austrian School who teach outside the United Stated, the topic of his lecture was the key starting points of this school and its contribution to economy. On this occasion, we talked to Anthony about the mutual influence of economics and politics, as well as practical recommendations for better reforms implementation.

1. What are your impressions after your talk at the Faculty of Political Sciences? In general, do young people deal enough with economic problems?

I was very pleased to talk with so many young people with new and interesing ideas. Some of the questions that came at the end of the talk demonstrated that young people understand policy issues and how economics can help solving all those issues. Even though the lecture was focused on economics, we had a good discussion about policy implications of specific economic models. I was quiet satisfied to see that so many young people understand importance of economy.

2. Nowdays there is a huge gap between the economy and political decision-making. What would motivate politicians to pay more attention to the economic consequences of decisions they make?

I think it's very difficult to get politicians to focuse on economics because economy tends to tell us more long term strategy and what works and what doesn't work. Contrary to that, politicians have very short time horizons. Also, the incentives that they face tend to constrain a lot of the things they can achieve and things they can do. That is why the best thing to do is to talk about economic ideas and to spread them. So, if the general public are conscious and understand economics, they can make their voting decisions based on that. Undoubtedly, it will lead to changes.

3. How would you describe briefly the Austrian School of economics? Why is it important for understanding the world we live in?

The Austrian School emphasizes the role of market, uncertanity and how individuals make choices. The key inside Austrian Economics is impotrance of entrepreneurship. If you're a young person who is thinking about going into business, you need to understend how you can create genuine value and how can you make sure that you are making products that people actually want to pay for. Also, you need to know that the profit is an indicator of success, and the loss is an indicaton of failure. The Austrian Economics helps entrepreneurs to really understand the signals they're receiving from the market. So, if you want to understand the real world and not the textbook of theoretical world, Austrian School is very helpful.

4. Having in mind mission of Libek – development of an entrepreneurial culture, fight for lower taxes, reducing public debt and promotion of fundamental reforms, what is in your opinion especially important for a successful process of advocasy?

This is an excellent question because I think that the low taxes and public debt are critical for an economy to be successful. Also, it's very important for young people to have successful future and to be able to enter the economy so they can create opportunities to get the best out of their own personal talent. There are lots of important reforms that countries can make, and I would say that the critical one is understanding the role of business at the solving social problems. Successful societies need to ensure that individuals have the right knowledge processes and incentive mechanisms to channel their unique talents into the public interest.

5. Serbia is running undefined economic policy with insufficient reform orientation. What would you recommend to our politicians?

Policy makers should try to step outside the short term, hustle and bustle policy. It's difficult to do that because their job is to get reelected and their incentives and constraints are focused on doing that. To lead to successful reform, policy makers need to read widely, take a step back, consider different economic schools of thoughts and other disciplines as well. This implies having general education and background that can make sure that their short term actions are actually moving the country in a right, longer term direction. Politicians should also read my primer on managerial economics, which is written form the perspective of the Austrian School, called ''Markets for Managers''.