Leading thinkers

Kaletsky and Kay join Edinburgh economics debate

Principal speakers: Anatole Kaletsky and John Kay

Some of the world’s leading economists, academics and investors will be Edinburgh next week to discuss how to avoid financial crises such as the 2008 downturn that tore through the banking sector.

Speakers at the event two-day conference will include the economists Anatole Kaletsky and John Kay, distinguished neuroscientists Karl Friston and Scott Kelso, leading philosophers  Julian Kiverstein and Duncan Pritchard, as well as legendary investors Howard Marks and Kiril Sokoloff.

The conference on Monday and Tuesday is being held at Panmure House, which was the Edinburgh residence of Adam Smith, the founding father of modern economics.

The focus of the debate the Market Mind Hypothesis, the brainchild of Heriot-Watt University’s Prof Patrick Schotanus, a new theory building on those of Smith.

Panmure House
Panmure House: apt location

Whereas economics has traditionally focused on the tangible physical manifestation of markets, the new theory combines economics, investing and cutting edge discoveries in cognitive science.

This multidisciplinary approach leads to insights that can improve markets, make investing more sustainable, increase the effectiveness of public policy and ultimately benefit society.

The theory holds that the market, instead of simply aggregating individual minds, creates and gathers into existence a collective mind of its own with its own consciousness. In other words, it formalises what investors have always casually referred to as “the market mind”. This theory could help avoid some of the excesses of markets – both bubbles and crashes — that have occurred over the years.  

Specifically, it is the market mind that extends “the invisible hand”, a famous idea suggested by Smith and one aim of the conference is to renew interest in Smith’s broadest thinking and promote Scotland as a centre of financial thought.

This research is considered particularly pertinent at present with many years of buoyant markets facing challenges from a number of directions including rising interest rates, central bank activity and fears related to the war in Ukraine.

Speaking in advance of the event Prof Schotanus said: “Where better than Panmure House, Adam Smith’s Edinburgh residence, to celebrate the theories of this renowned philosopher and how his ideas underpin the latest thinking in cognitive economics?

“The Market Mind Hypothesis can help us all better understand why markets act the way they do – why they fall when they shouldn’t, and why they climb for no good reason. This conference will place Scotland firmly at the centre of modern economic thinking and ensure our universities continue to drive research in this important field.”

About Panmure House

Originally built in 1691, Panmure House is a unique place as the last and only remaining residence of Adam Smith, the father of economics. Here, between 1778 and 1790, he completed the final editions of his famous books—The Theory of Moral Sentiments/The Wealth of Nations—and invited other luminaries of the Scottish Enlightenment for dinner discussions.

In 2008, Edinburgh Business School undertook to rescue the building from dereliction. Following a 10-year, £5.6m renovation, Panmure House was formally opened in November 2018. It now operates as a research and event centre.

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