Economist Ronald Coase Was Chased Out of UVA in 1963 for Supporting Market Solutions.

The Twitter feed of academic Siva
Vaidhyanathan points to this story about how recently deceased
economist Ronald Coase was chased out of the University of Virginia
in the early 1960s.

The heinous crime of Coase, who would go on to win the 1991
Nobel Prize in economics? He stood against the rising tide of
belief in an economy managed by experts and regulators.

“He introduced this whole notion,” says [UVA law prof George]
Cohen, “that people through private negotiation can reach an
efficient solution.”

What Coase and his colleagues were challenging, Cohen says,
was the widespread belief that the only way to protect scarce
resources— such as air, water, or habitat— was via taxation.
Unfortunately, as Coase and Center co-founder James M. Buchanan
would learn, using markets to achieve efficient and beneficent
goals would run afoul of the university administration intent on a
more “modern” outlook.

In 1994, Coase told this reporter how one of his UVA colleagues
accidentally received a copy of a secret dossier compiled by then
Dean of the Faculty Robert Harris in which Harris outlined a plan
to change the economics faculty. Under then President Edgar
Shannon, Harris allegedly used non-promotion and non-offer-matching
to force Jefferson Center scholars to disperse. Coase left UVA for
Chicago in 1964; Buchanan departed four years later.

“I think [the report] was very damning because it makes quite
clear what their attitude was and there was actually a policy to
get rid of us,” Coase said….

Buchanan and Coase got the last laugh, as each would win the
Nobel Prize for Economics, Buchanan in 1986 and Coase in 1991.

“The secret report became known in a very peculiar way,” Coase
told me. “What happened was that Warren Nutter, who was chairman of
the department, asked for some file, and when he got it, there it

“The University of Virginia was not interested in retaining me,”
continued Coase. “It was a political thing. They had decided that
my views, which they never understood— they never tried to
ascertain my views actually.”

Read the whole thing – a truly disturbing example of ideological
prejudice –

And read Reason’s
1997 interview
with Coase (conducted by economist Thomas W.
Hazlett, now at George Mason University, the eventual home of James
Buchanan and Gordon Tullock, who was also chased out of UVA for
ideological reasons). Coase elaborates on what it was like at UVA
in the late 1950s and early ’60s:

Reason: You began teaching at the
University of Virginia in the late 1950s, and by the early 1960s
the administration there was not impressed with the work being done
by yourself, Warren Nutter, James Buchanan, Gordon Tullock- four of
the most famous and influential economists in the post-war era, two
of whom [Coase and Buchanan] went on to win Nobel prizes. Yet the
University of Virginia was not happy with what was happening in
their economics department.

Coase: They thought the work we were doing
was disreputable. They thought of us as right- wing extremists. My
wife was at a cocktail party and heard me described as someone to
the right of the John Birch Society. There was a great antagonism
in the ’50s and ’60s to anyone who saw any advantage in a market
system or in a nonregulated or relatively economically free

thing here.