- 27 Feb, 23
Armen Alchian 101: The Revolutionary Thinker of Economics
Armen Alchian was an American economist born on April 12, 1914. He spent most of his career at the University of California, Los Angeles (UCLA). He is known as an important microeconomic theorist and one of the founders of the new institutional economics. He is widely accepted for his work on property rights. In this article on Zatrun.com, you can find everything you need to know about Armen Alchian.
Table of Contents
Who is Armen Alchian?
Armen Alchian was born on April 12, 1914, in Fresno, California. His father, Alexander Alchian, migrated from the Ottoman Empire to the United States in 1901, and his mother, Lily Normart, grew up in an Armenian family in Fresno. His family was one of the first Armenian immigrants, and Armen was the first Armenian-born in Fresno. His father worked as a musician and jeweller, and the family had a “modest” income.
Alchian grew up in the Armenian community, which was subjected to intense discrimination, and he himself was also subjected to discrimination at an early age. Alchian is the only prominent Armenian-American economist known as the “Armenian Adam Smith.”
He excelled in academic and athletic skills at Fresno High School. In 1932, he enrolled in Fresno State College, and in 1936, he received his bachelor’s degree from Stanford University. He received his PhD in economics with his thesis titled “Effects of Changes in the General Wage Structure.” Anthony J. Culyer said that Alchian was the brightest economics student at Stanford University.
His Ideas and Works
Armen Alchian is a well-known figure with his economic theories and research. He served as a faculty member in the Economics Department at UCLA and has authored numerous articles and books. His most famous work is “University Economics,” which focuses on microeconomic theories and the importance of market mechanisms. Alchian is recognised for the significant impact of his economic ideas and research and has made a significant contribution to the field of economics.
In addition to his economic theories and practices, Alchian was also interested in social and political issues. He expressed his ideas on privatisation, free-market economies, and tax policies. Alchian has conducted research on how the tax system, wage system, and other economic mechanisms can be improved to ensure that they are fair and effective.
Alchian is a well-known figure for his work and ideas in the field of economics. His research on microeconomic theories, market mechanisms, and tax policies has played a significant role in economics. Alchian holds a significant place in the field of economics due to his economic ideas and research.
His Academic Career and Research Activities
Alchian primarily worked as a lecturer at Stanford University from 1937 to 1940 and later as an instructor at the National Bureau of Economic Research and Harvard University in 1940-1941 and at the University of Oregon in 1942. He also served as a statistician in the Army Air Forces from 1942 to 1946.
In 1946, he joined the Economics Department at the University of California, Los Angeles, where he started as an assistant professor and was appointed as a professor in 1958. He retired in 1984 and continued to write and teach until his death in 2013.
Armen Alchian is known as an applied economist and has been described by Robert Higgs as a master of applied price theory. He is a neoclassical economist from the Chicago school and, along with Harold Demsetz, is also considered a founder of the “UCLA tradition” or the Los Angeles school. Alchian was influenced by the Austrian school, especially the ideas of Ludwig von Mises and Friedrich Hayek, and was inspired by Hayek’s articles “Economics and Knowledge” and “The Use of Knowledge in Society”.
Alchian serves as a bridge between the “Old” and “New” Chicago Schools, alongside James M. Buchanan and Ronald Coase, and is one of the founders of New Institutional Economics. Alchian’s most significant contribution is the economic analysis of property rights. Alchian emphasised the important role of property rights in determining economic performance, stating that “Economics essentially examines property rights over resources.” Additionally, while working at RAND in 1954, he conducted the first event study to identify the fuel materials for hydrogen bombs.
Armen Alchian’s Legacy
Armen Alchian is recognised as the founder of an alternative school of economics known as the Los Angeles school, which is neoclassical in nature and has ties to the Chicago school. He was also influenced by the Austrian school and played a significant role in the economic analysis of property rights. Alchian served as a bridge between the “Old” and “New” Chicago Schools alongside economists such as James M. Buchanan and Ronald Coase.
Alchian has been recognised by Peter Boettke as the founder of “property rights economics.” While working at RAND, Alchian used publicly available data to identify the fuel materials used in the development of hydrogen bombs. Alchian’s contributions include numerous works on economic analysis, property rights, and privatisation.