IFREE’s Outreach to Eastern and Central Europe

NEW! An update on the International Workshop in Experimental Economics at the ISM University of Management and Economics in Lithuania that took place on April 6-8, 2009. Read it here!

by Rimvydas Baltaduonis, Ph.D.

After seeing the mind transforming impact that IFREE’s workshops have on students in the U.S., Dr. Bart Wilson, Jeff Kirchner and myself, with the support of IFREE, are extending the reach of this impact beyond the United States to empower Eastern and Central Europe with the tools and experience of experimental economics.

Since the collapse of the Soviet Union in 1991, Eastern and Central Europe have undergone an amazing transformation. Decentralized markets replaced central planning. Private initiatives crowded out top-to-bottom decision making. The absence of one strong power in the continent opened the doors to infinite opportunities for free trade and specialization. For more than a decade, the region enjoyed the growth of prosperity and relative peace. In recent years, however, the accession of many Eastern and Central European countries into the European Union (EU) has led to some non-EU trade restrictions. There are attempts to promote more bureaucratic vision for the EU, especially among bigger and older members of the EU. On the Eastern side of the continent, some political processes and the rise of oil prices might have again given an illusion that the game of control is still a prosperous possibility. Meanwhile countries in Eastern and Central Europe – from Estonia to Lithuania to Ukraine and to Georgia – retain strong groups of free market and competition advocates.

Being the first republic to break off the Soviet Union, Lithuania vowed to promote stable and peaceful EU Eastern Neighborhood. Together with other Baltic partners Lithuania is a vocal supporter for democratic processes in Ukraine, Georgia, Moldova, Russia etc. The goal of this workshop is to expose the Eastern and Central European academic community to experimental research and teaching method in economics and to leave them with the tools and experience to build a program in experimental economics.

April 6-8, 2009 national and international policy makers, graduate students, undergraduates and faculty will participate in the workshop at the ISM University of Management and Economics in Vilnius, Lithuania. ISM was one of the first initiatives to offer private education and research at the university level in Lithuania and it is the only private university in Lithuania offering doctoral programs in economics. This workshop will contribute to the establishment of a reliable partnership with an ambitious Lithuanian university that will be capable of hosting more international workshops in the future. While some political processes in the region are suggesting a return to an illusion that the “game” of control is still a prosperous possibility, the countries in Eastern and Central Europe – from Estonia to Lithuania to Ukraine and to Georgia – retain strong groups of free market and competition advocates. I see IFREE’s workshops as a very natural way to build a diverse academic community in Eastern and Central Europe that would adopt the methods of experimental economics and that could tackle important issues of the region.

Building on the experience with the workshop in Lithuania and on the contacts that will develop out of this experience, I expect the outreach to continue into other Eastern and Central European countries by building a network of faculty and students who become interested in what experimental economics has to offer.

We have seen that people’s behavior changes depending on their perception of a game and on the perceptions of other players’ perceptions. IFREE’s workshops include an array of experiments that illuminate the importance of institutions in shaping these perceptions and consequently, the behavior. Controlled laboratory experiments provide a unique opportunity to experience various institutions and to learn from those experiences. If our U.S. workshops are any indication, this workshop will be a great start to promoting the “game” of specialization and exchange rather than control and power.