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Vernon Lomax Smith

He is the founder and president of the International Foundation for Research in Experimental Economics and a Senior Fellow at the Cato Institute in Washington D.C.


  • Vernon Lomax Smith was born on January 1, 1927 in Wichita, Kansas where he attended Wichita North High School and Friends University. He received his bachelor's degree in electrical engineering from Caltech in 1949, an M.A.in economics from the University of Kansas in 1952, and his Ph.D. in economics from Harvard University in 1955.He is a professor of economics at Chapman University's Argyros School of Business and Economics and School of Law in Orange, California, a research scholar at George Mason University Interdisciplinary Center for Economic Science, and a Fellow of the Mercatus Center, all in Arlington, Virginia.

Major achievements

  • He developed methods for laboratory experiments in economics, which has helped understanding of economic behavior. Smith formalized the methodology of experimental economics. His book "Experimental Economics: Induced Value Theory" was the first articulation of the principle behind economic experiments. Later he expanded this principles and adapted them to the development of economic experiments. Mechanism design provide a formal means for tests of the performance of an economic institution, while experimental economics provided a means for formal empirical assessment of the performance of economic institutions. Smith describes the technique of induced values. This is the method used in controlled laboratory experiments in economics, political science, and psychology. This technique is what allows experimental economists to create a replica of a market in a laboratory. Subjects in an experiment are told that they can produce a "commodity" at a cost, and then sell it to buyers. The seller earns the difference between the price received and its cost. Buyers are told that the commodity has a value to them when they consume it, and earn the difference between the value of the commodity to them and its price. Using this technique, Smith and his coauthors have examined the performance of alternative trading mechanisms in resource allocation.
  • Smith shared the 2002 Nobel Memorial Prize in Economic Sciences with Daniel Kahneman.


  • "Bargaining and Market Behavior", 2000
  • "Papers in Experimental Economics", 2006
  • "Rationality in Economics", 2008
  • Investment and production; a study in the theory of the capital-using enterprise, 1961


  • American Association for the Advancement of Science

  • American Academy Arts & Scis.

  • Econometric Society; National Academy of Sciences

  • Public Choice Society

  • Southern Economic Association

  • Economic Science Association

  • Association Private Enterprise Education

  • American Economic Association

  • Western Economic Association


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Born January 1, 1927
  • 1949
    California Institute of Technology
  • 1952
    University of Kansas
  • 1955
    Harvard University
  • 1955 - 1958
    Associate Professor, Krannert School of Management, Purdue University
  • 1958 - 1967
    Professor, Krannert School of Management, Purdue University
  • 1961 - 1962
    Visiting Professor, Stanford University
  • 1967 - 1968
    Professor, Brown University
  • 1968 - 1972
    Professor, University of Massachusetts
  • 1972 - 1973
    Professor, Center for Advanced Study in the Behavioral Sciences
  • 1973 - 1975
    Professor, California Institute of Technology
  • 1976 - 2002
    Professor, University of Arizona
  • 2002
    George Mason University
  • 2002
    Founder, Economic Science Institute, Chapman University
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Lidia Shilovich last changed 25/12/2012 view changes
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