The University of Minnesota Department of Economics has historically been one of the best in the world, producing nine Nobel Prize winning faculty and alumni along the way. The Heller-Hurwicz Economics Institute was launched in 2010 to advance Minnesota’s legacy of producing field-shaping research and to build a bridge between its world-class economic research and policy that promotes the public good.
Heller-Hurwicz is personified by its namesakes, pairing the best in research with the best in policymaking - Nobel prize-winning Leo Hurwicz, who developed the theory of mechanism design, and influential policymaker Walter Heller, responsible for major federal policy initiatives while advising Presidents Kennedy and Johnson. Away from the pressures of Washington and Wall Street, Heller-Hurwicz is becoming a global, nonpartisan leader in translating frontier economic research into real-world policy solutions.
The Heller-Hurwicz Economics Institute focuses on areas where there is potential to break new ground in teaching and research, discover frontier tools of economic theory, and apply them to policies and institutions that will address global challenges today and in the future. These areas include:
- Advancing Leo Hurwicz’s pure theory of mechanism design—that is, improving theoretical understanding of how properly designed institutional rules can channel individual self-interest toward achieving social goals
- Progress in understanding the optimal design of social safety nets—government insurance programs such as Medicare—which depend on taxation of some and transfer to others, while fostering work incentives
- Furthering the design of fiscal and monetary policy, areas that Walter Heller pioneered directly by initiating President Johnson’s War on Poverty, and designing tax policies to shape the path of economic growth
- Exploring issues of corporate governance to formulate systems and policies that are mutually beneficial for corporate managers and their incentive structures; and corporate owners, i.e., shareholders, who seek profit growth but also investment safety
- Developing financial regulatory systems that judiciously balance rewards for beneficial financial innovation with safeguards to ensure fundamental stability in the overall financial system
- Improving design of policies that align financial incentives and environmental protection, harnessing market forces to accomplish broader social goals by recognizing the externalities of economic activity