Economist and scholar Robert Litan spoke about how challenging it is for legal scholars to keep up with the rapid changes in the current financial world during an interview with The Daily Texan.

Litan is the inaugural recipient of the $50,000 Massey Prize for Research in Law, Innovation and Capital Markets, which recognizes the need for leaders in law to engage capital markets and economic development. He received the award for his research in law, innovation and capital markets according to the prize website.

Litan serves as the vice president for research and policy at the Ewing Marion Kauffman Foundation. He is also a senior fellow in economic studies at the Brookings Institution and recently co-authored “Good Capitalism, Bad Capitalism, and the Economics of Growth and Prosperity.”

“In the book, we talked about the four different kinds of capitalism around the world: mercantilist, oligarchist, entrepreneurial and managerial capitalism,” Litan said. “We discussed the pros and cons of all four and concluded that the optimal form would be a mix of managerial and entrepreneurial capitalism.”

Litan will join other speakers, including dean of the McCombs Business School Thomas Gillgan and New York Times senior financial writer Diana Henriques, in Austin at the Massey Prize Symposium on Nov. 11.

Matthew Spitzer, head regents chair for faculty excellence in the School of Law, said the school has already made the transition to bringing other fields into law classrooms, and the Massey Prize will help continue this trend.

“The Massey Prize deals with the intersection of three things: law, innovation and capital markets,” Spitzer said.

He said the U.S. economy has experienced significant changes since the 1970s.

“There has been less manufacturing and more innovation,” Spitzer said. “To the extent that Texas is traditionally seen as a place that you pump oil from, the Massey Prize will show that we are about more by bringing important people here and incentivizing innovation.”

UT law ’76 alumnus Edward Knight, who nominated Litan for the award, said Litan stood apart from the other candidates because of his writing, his scholarship and his work.

“He has not only an academic background, but he has worked in government and knows how to implement policy,” Knight said. “He does not have an ivory tower mentality.”

Litan’s writings deal with good and bad competition in the economy and the necessity of transparency in a functional economy, said Knight.

“Increasingly, as you practice law in today’s world you have to understand the world economy and the intersection of the two: law and economics,” Knight said.

Knight said Litan’s work also has great practical significance.

“His ideas relate to the way that families save to pay for their children’s college and their retirement,” Knight said. “These are not just theoretical concepts.”

Printed on October 12, 2011 as: Inaugural Massey Prize awarded to economist for law, capital markets research