Texas Tech Economist Lectures at European Free Market Road Show

The central topic of the discussions was “To Save or Not to Save: Will austerity programs alone save Europe?”

The director of the Free Market Institute (FMI) at Texas Tech University recently traveled throughout eastern and southern Europe as a guest speaker for the 6th Annual Free Market Road Show.

Benjamin Powell, also a visiting professor at Texas Tech, delivered lectures and participated in panel discussions in nine countries over 15 days including Kosovo, Albania, Montenegro, Croatia, Italy, Bosnia and Herzegovina, to share his expertise and coordinate with others seeking productive resolutions to the economic and financial problems plaguing many countries in Europe.

“Of all the former communist countries that I lectured in, only Montenegro rates in the top quarter of countries in economic freedom,” Powell said. “To better promote a higher standard of living, these countries need to shrink the size and scope of their governments while better protecting private property rights and the rule of law.”

The central topic of the discussions was “To Save or Not to Save: Will austerity programs alone save Europe?” Powell lectured on the need for regulatory and monetary reform, how Europe can best address its very high rates of youth unemployment, and the general need for greater economic freedom in these mostly former communist countries.

“When it comes to the high rates of youth unemployment, these are often caused by bad labor market regulations,” he said. “European laws that make it difficult and expensive to fire workers are one of the prime culprits. Who would choose to get married if you had to make that choice after only one date?  This is essentially the situation many European governments put employers in if they want to hire a worker. This is a particular problem for young people who have a less-proven track record and are trying to land their first job.”

Greece has revealed a fundamental problem in the European Monetary Union, he said. Because the European Central Bank (ECB) holds debt of member country governments (in order to conduct monetary policy) it’s in the ECB’s interest to not let countries default on their debt.

“Knowing that there is a high likelihood of a bailout from the ECB encourages member countries to engage in the very reckless fiscal policies that make bailouts necessary,” he said.

Presented by the Austrian Economics Center (AEC) in cooperation with more than 40 leading think-tanks and universities across Europe and the Caucasus, the 2013 Free Market Road Show brought together leading business practitioners, scholars, students, opinion leaders, policy experts, elected officials and diplomats from across Europe to discuss and explore solutions to pressing policy questions affecting countries within and on the periphery of the European Union.

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CONTACT: Benjamin Powell, director of the Free Market Institute, Texas Tech University, (806) 834-3097, or benjamin.powell@ttu.edu.