The Adam Smith Institute (ASI) is a neoliberal UK-based

think tank A think tank, or policy institute, is a research institute that performs research and advocacy concerning topics such as social policy, political strategy, economics, military, technology, and culture. Most think tanks are non-governmenta ...

and

lobbying group In politics, lobbying, persuasion or interest representation is the act of lawfully attempting to influence the actions, policies, or decisions of government officials, most often legislators or members of regulatory agencies. Lobbying, which ...

, named after

Adam Smith Adam Smith (baptized 1723 – 17 July 1790) was a Scottish economist and philosopher who was a pioneer in the thinking of political economy and key figure during the Scottish Enlightenment. Seen by some as "The Father of Economics"——— ...

, a Scottish moral philosopher and

classical economist Classical economics, classical political economy, or Smithian economics is a school of thought in political economy that flourished, primarily in Kingdom of Great Britain, Britain, in the late 18th and early-to-mid 19th century. Its main thinkers ...

. The libertarian label was officially changed to neoliberal on 10 October 2016. The Institute advocates

free market In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any o ...

and

classical liberal Classical liberalism is a political tradition and a branch of liberalism that advocates free market and laissez-faire economics; civil liberties under the rule of law with especial emphasis on individual autonomy, limited government, economic ...

ideas, primarily via the formation of policy options with regard to public choice theory, which political decision makers seek to develop upon. ASI President Madsen Pirie has sought to describe the activity of the organisation as " propose things which people regard as being on the edge of lunacy. The next thing you know, they're on the edge of policy". The ASI formed the primary intellectual force behind privatisation of state-owned industries during the premiership of

Margaret Thatcher Margaret Hilda Thatcher, Baroness Thatcher (; 13 October 19258 April 2013) was Prime Minister of the United Kingdom from 1979 to 1990 and Leader of the Conservative Party (UK), Leader of the Conservative Party from 1975 to 1990. S ...

, and alongside the

Centre for Policy Studies The Centre for Policy Studies (CPS) is a think tank and pressure group in the United Kingdom. Its goal is to promote coherent and practical policies based on its founding principles of: free markets, "small state," low tax, national independe ...

and

Institute of Economic Affairs The Institute of Economic Affairs (IEA) is a right-wing pressure group and think tank registered as a UK charity Associated with the New Right, the IEA describes itself as an "educational research institute", and says that it seeks to "further t ...

advanced a neoliberal approach toward public policy on privatisation, taxation, education and healthcare. A number of the policies presented by organisation were adopted by the administrations of

John Major Sir John Major (born 29 March 1943) is a British former politician who served as Prime Minister of the United Kingdom and Leader of the Conservative Party (UK), Leader of the Conservative Party from 1990 to 1997, and as Member of Parliament ...

and

Tony Blair Sir Anthony Charles Lynton Blair (born 6 May 1953) is a British former politician who served as Prime Minister of the United Kingdom from 1997 to 2007 and Leader of the Labour Party from 1994 to 2007. He previously served as Leader of th ...

and members of the ASI have also advised non-United Kingdom governments. Beyond policy development, the organisation advocates free market ideas through the publication and distribution of literature, the promotion of Tax Freedom Day, the hosting of speaker events for students and young people, media appearances and blogging.

History

Foundation

Madsen Pirie and brothers Eamonn and Stuart Butler were students together at the

University of St Andrews (Aien aristeuein) , motto_lang = grc , mottoeng = Ever to ExcelorEver to be the Best , established = , type = Public research university Ancient university , endowment ...

in Scotland. Pirie left in 1974 to work for the Republican Study Committee in Washington D.C. and then took up a professorship in Philosophy at Hillsdale College. He was joined there by Stuart Butler while Eamonn Butler went to work with

Edwin Feulner Edwin John Feulner Jr. (born August 12, 1941) is a former think tank executive who founded the conservative think tank The Heritage Foundation and served as its president from 1977 to 2013 and again from 2017 to 2018. Feulner's positions have in ...

, who became co-founder and director of the free-market think tank

The Heritage Foundation The Heritage Foundation (abbreviated to Heritage) is an American conservative think tank based in Washington, D.C. that is primarily geared toward public policy. The foundation took a leading role in the conservative movement during the presiden ...

. After their experience in the United States, they returned to the United Kingdom in 1977 to found their own think tank, called the Adam Smith Institute. After a year, Stuart Butler returned to the United States as Vice President of the Heritage in charge of domestic policy while Eamonn Butler remained with Madsen Pirie as co-directors of the Institute. One of their St Andrews friends, Douglas Mason, who had been active in the university's Conservative Association, did his most influential research and writing for the Institute. Mason became one of its regular authors. The ASI's Omega Project (1981–1983) led by Peter Young produced a series of 19 papers shadowing each Department of State and advocated such things as the compulsory contracting-out of most local services such as refuse collection, the replacement of much of the welfare state by private insurance and further privatisation of public sector services and industries, including aspects of police services.

Thatcher's inner circle

The

era saw the think tank movement come of age and achieve influence and with the

(CPS) and the

(IEA) and the ASI was one of three relied upon by the Thatcher government for policy. Unlike the CPS, which had been established by Thatcher and Keith Joseph; and the IEA, which focused on more theoretical matters, the ASI was well-placed to produce bold and direct policies. Despite this role, the Institute developed an iconoclastic reputation, cynical about politicians, but enthusiastic to engage with them. The Institute's relationship with Thatcher was not without troubles. Although Madsen Pirie was the architect of much of the privatisation policy, he had no emotional ties to Thatcher, nor did the ASI propose policies on a range of social issues despite its

Thatcherite Thatcherism is a form of British conservative ideology named after Conservative Party leader Margaret Thatcher that relates to not just her political platform and particular policies but also her personal character and general style of manag ...

reputation. The ASI took the view that the market was "more genuinely democratic than the public sector, involving the decisions of far more individuals and at much more frequent intervals". The Institute published Douglas Mason's recommendation that local government rates (the local government tax) should be replaced by a per-capita charge. A version of this was later implemented by the

Conservative Conservatism is a cultural, social, and political philosophy that seeks to promote and to preserve traditional institutions, practices, and values. The central tenets of conservatism may vary in relation to the culture and civilization i ...

government introducing the

Community Charge The Community Charge, commonly known as the poll tax, was a system of taxation introduced by Margaret Thatcher's government in replacement of domestic rates in Scotland from 1989, prior to its introduction in England and Wales from 1990. It pr ...

in Scotland in 1989 and in England and Wales in 1990. It brought unpopularity for the Thatcher government and was seen by some as having weakened her political hand ahead of her departure from office, though her attitude to Europe was a more significant factor. Other policy recommendations which Douglas Mason published with the ASI included the privatisation of the

Royal Mail , kw, Postya Riel, ga, An Post Ríoga , logo = Royal Mail.svg , logo_size = 250px , type = Public limited company , traded_as = , foundation = , founder = Henry VIII , location = London, England, UK , key_people = * Keith Williams ...

(''The Last Post'' − 1991); the introduction of charges in British public libraries (''Ex Libris'' – 1986); the privatisation of the Forestry Commission; the complete removal of arts subsidies (''Expounding The Arts'' – 1987); and the abolition of restrictions on drinking (''Time To Call Time'' – 1986).

After Thatcher

In November 1994, the Institute began a review of welfare reform called Operation Underclass, aimed at methods of creating jobs for the long-term unemployed. Some elements of the programme were adopted by the government within months. The ejection of the Conservative government in 1997 did not have as dramatic an effect on the ASI as some had anticipated. The Institute praised the government's welfare-to-work programmes, describing it as "the most successful policy initiative of this century". The ASI publicly welcomed the news that

Labour Labour or labor may refer to: * Childbirth, the delivery of a baby * Labour (human activity), or work ** Manual labour, physical work ** Wage labour, a socioeconomic relationship between a worker and an employer ** Organized labour and the labour ...

had implemented the long-held ASI aim of an independent Bank of England, Madsen Pirie gave it a nine out of ten for performance. Eamonn Butler has ascribed this flexibility to who is in power to their role not being "to be political or shout slogans", but to be "policy engineers". The ASI then collaborated with the

MORI Mori is a Japanese and Italian surname, and also a Persian pet name for Morteza. It is also the name of two clans in Japan, and one clan in India. Italian surname *Barbara Mori, Uruguayan-Mexican actress * Camilo Mori, Chilean painter * Cesare ...

organisation on a series of opinion polls to measure such things as the goals of young people and students, and public attitudes to state services.

International work

In 1992, the Institute founded a consulting company, Adam Smith International Ltd, which was "charged with overseeing the overseas work of the institute nan attempt to capitalise on the growing international trend towards economic liberalization and marketization".Denham and Garnett (1998), p. 153 While Eamonn Butler and Madsen Pirie were as of 1998 members of the management board of both organisations, the management teams of

Adam Smith International Adam; el, Ἀδάμ, Adám; la, Adam is the name given in Book of Genesis, Genesis 1-5 to the first human. Beyond its use as the name of the first man, ''adam'' is also used in the Bible as a pronoun, individually as "a human" and in a coll ...

and the Institute are now separate.

Funding

Think tank

Transparify Transparify is an initiative that provides a global rating of the financial transparency of major think tanks. It rates the extent to which think tanks publicly disclose their sources of funding, the amount of funding they have received, and the s ...

, which is funded by the

Open Society Foundations Open Society Foundations (OSF), formerly the Open Society Institute, is a Grant (money), grantmaking network founded and chaired by business magnate George Soros. Open Society Foundations financially supports civil society groups around the wo ...

, ranked the Institute as one of the four least transparent think tanks in the United Kingdom in relation to funding. Transparify's report ''How Transparent are Think Tanks about Who Funds Them 2016?'' rated them as "highly opaque", one of "a handful of think tanks that refuse to reveal even the identities of their donors". In 2022, the website

Who Funds You? Who Funds You? is a project that rates and promotes transparency of funding sources of think tanks. The project scored think tanks according to four criteria, namely whether the organisation discloses its income, whether it publishes financial de ...

rated the Institute as E, the lowest transparency rating (rating goes from A to E). TobaccoTactics, the website of the Tobacco Control Research Group at the

University of Bath (Virgil, Georgics II) , mottoeng = Learn the culture proper to each after its kind , established = 1886 (Merchant Venturers Technical College) 1960 (Bristol College of Science and Technology) 1966 (Bath University of Technology) 1971 (univ ...

, details the Institute's funding by the tobacco industry. ''

The Guardian ''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers ''The Observer'' and ''The Guardian Weekly'', ''The Guardian'' is part of the Gu ...

'' report that the Institute received three percent of its funding from the tobacco industry in 2013.

Investigated for breaches of charities rules

In December 2018, the Institute, which consists of at least three different legal entities (a British company, a British charity and an American non-profit foundation), was reported to be under investigation by the

Charity Commission , type = Non-ministerial government department , seal = , seal_caption = , logo = Charity Commission for England and Wales logo.svg , logo_caption = , formed = , preceding1 = , ...

for improper use of funds. Charities in England and Wales are required to be genuinely independent from other entities, and cannot perform political campaigning. Contributors giving £1,000 a year were offered “opportunities to attend power lunches and patrons dinners with influential figures, including politicians, ministers, journalists and academics.”

Activities

Tax Freedom Day

The Institute publishes the British version of Tax Freedom Day, the day in the year when the average person has earned enough to pay his or her annual tax bill. The Institute calculates the figure by expressing the government's take of the economy as a percentage of the year, including all forms of taxation, direct and indirect, national and local.

The Next Generation

The Liberty League was a United Kingdom student organisation in the early 2010s, was founded by members of the Next Generation Committee (James Lawson, William Hamilton and Anton Howes). It aimed to support classical liberalism. Its annual Freedom Forum conference was transferred to the Institute.

Influence

In January 2009, ''

Foreign Policy A State (polity), state's foreign policy or external policy (as opposed to internal or domestic policy) is its objectives and activities in relation to its interactions with other states, unions, and other political entities, whether bilaterall ...

'' and the

University of Pennsylvania The University of Pennsylvania (also known as Penn or UPenn) is a private research university in Philadelphia. It is the fourth-oldest institution of higher education in the United States and is ranked among the highest-regarded universitie ...

named the Institute among the top 10 think-tanks in the world outside of the United States. The Institute is highly influential in United Kingdom public policy and was "a pioneer of privatisation" in the United Kingdom and elsewhere. Early Institute papers proposed the outsourcing of local government services (1980), the fundamentals of the

poll tax A poll tax, also known as head tax or capitation, is a tax levied as a fixed sum on every liable individual (typically every adult), without reference to income or resources. Head taxes were important sources of revenue for many governments fr ...

(1981–1985) and the

deregulation Deregulation is the process of removing or reducing state regulations, typically in the economic sphere. It is the repeal of governmental regulation of the economy. It became common in advanced industrial economies in the 1970s and 1980s, as a ...

and

privatisation Privatization (also privatisation in British English) can mean several different things, most commonly referring to moving something from the public sector into the private sector. It is also sometimes used as a synonym for deregulation when ...

of transportation (1980). Other influences include the United Kingdom's cutting of the highest rate of

income tax An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Tax ...

from 83% to 40% in the late 1980s and its liberalisation of alcohol licensing laws. The Institute has released a series of Roadmap to Reform papers, calling for shifts in public policy in Health, Deregulation and Europe. In 2006, the Institute released a paper calling for a rethink of Britain's countryside policy. According to the ''2014 Global Go To

Think Tank A think tank, or policy institute, is a research institute that performs research and advocacy concerning topics such as social policy, political strategy, economics, military, technology, and culture. Most think tanks are non-governmenta ...

Index Report'' (

Think Tanks and Civil Societies Program The Think Tanks and Civil Societies Program (TTCSP) was a non-profit program at the University of Pennsylvania in Philadelphia, Pennsylvania, that operated from 1989 to 2021. TTCSP was originally established at the Foreign Policy Research Instit ...

), the ASI is ranked number 69 (of 150) of the "Top Think Tanks Worldwide". Other "Top Think Tank" rankings include No. 3 (of 80) in Domestic Economic Policy, No. 5 (of 50) in International Economic Policy, No. 17 (of 60) for Best Use of Social Networks, No. 40 (of 60) of Think Tanks with the Best External Relations/Public Engagement Program, No. 24 (of 70) for the Most Significant Impact on Public Policy, and No. 12 (of 60) for Outstanding Policy-Oriented Public Programs.

Tax reform

A 2005 paper by the Institute proposed a flat-rate income tax of 22% for United Kingdom taxpayers, with the above-referenced tax-free personal allowance of £12,000. ''

City A.M. ''City A.M.'' is a freesheet, free business-focused newspaper distributed in and around London, England, with an accompanying website. Its certified distribution was 85,738 copies a day in February 2020, according to statistics compiled by the A ...

'' editor Allister Heath said of this report that "rarely has a think-tank publication been this influential so quickly. Its arguments have been dissected by the UK Treasury, are well known among the Shadow Treasury Team, have had an influence on some parts of the Liberal Democrats and were even adopted by several minor political parties". The ASI continues to campaign for a

flat tax A flat tax (short for flat-rate tax) is a tax with a single rate on the taxable amount, after accounting for any deductions or exemptions from the tax base. It is not necessarily a fully proportional tax. Implementations are often progressiv ...

Public sector reform

Education

The

Education Reform Act 1988 The Education Reform Act 1988 is widely regarded as the most important single piece of education legislation in England and Wales since the 'Butler' Education Act 1944. Provisions The main provisions of the Education Reform Act are as follows: ...

reflected many policy changes proposed by the Institute, including increasing representation of parents on state school governing boards, shifting control of state schools from the local authority to the board and head teachers and abolishing fixed school catchment areas.

Rail privatisation

With its author Kenneth Irvine, the ASI says it pioneered the

privatisation of British Rail The privatisation of British Rail was the process by which ownership and operation of the railways of Great Britain passed from government control into private hands. Begun in 1994, it had been completed by 1997. The deregulation of the industr ...

with private companies competing for franchises on a separately owned national network (The Right Lines – 1987). This policy was enacted by

's government.

Immigration

The Institute is one of the strongest defenders of

immigration Immigration is the international movement of people to a destination country of which they are not natives or where they do not possess citizenship in order to settle as permanent residents or naturalized citizens. Commuters, tourists, and ...

Current viewpoints

Green belt

The ASI has written extensively about the effect the

green belt A green belt is a policy and land-use zone designation used in land-use planning to retain areas of largely undeveloped, wild, or agricultural land surrounding or neighboring urban areas. Similar concepts are greenways or green wedges, which hav ...

has had on house prices by restricting where houses can be built. In its paper ''The Green Noose'', the Institute wrote that "simply removing restrictions on land 10 minutes’ walk of a railway station would allow the development of 1 million more homes within the Green Belt surrounding London alone". The ASI believes that instead of simply putting a blanket ban on building in the areas surrounding cities, planning permission should be granted based on the environmental, historic and scientific value of the land.

Rail policy

Amid ongoing debate about the railways, the ASI has been an advocate of the privatised system, writing that much of the rise in passenger numbers since privatisation cannot be attributed to other factors. It has called for increased competition through the use of open access operators or having two operators sharing a franchise and competing with each other.

Publications

; Books * ''Economy and Local Government'', Eamonn Butler & Madsen Pirie, 1981 * ''Aid by Enterprise'', Eamonn Butler & Madsen Pirie, 1984 * ''Hayek'', Eamonn Butler, 1985 * ''Milton Friedman: A Guide to His Economic Thought'', Eamonn Butler, 1985 * ''Micropolitics: Creation of a Successful Policy'', Madsen Pirie, 1988 * ''Wayward Elite: A Critique of British Teacher-Education'', Dennis O'Keeffe, 1990 * ''Adam Smith's Legacy'',

Norman Barry Norman Christopher Barry (December 25, 1897 – October 13, 1988) was an American judge, politician, and football coach. Political and judicial career Barry was born in Chicago, Illinois. He went to the Chicago public schools and then went ...

et al., 1990 * ''A country at ease with itself'', Michael Forsyth, 1991 * ''Taming the Trade Unions'', Eamonn Butler, 1991 * ''Blueprint for a Revolution'', Madsen Pirie, 1993 * ''Vision: Targets for Britain'', Madsen Pirie, 1994 * ''Shephard's Warning: Setting Schools Back on Course'',

Antony Flew Antony Garrard Newton Flew (; 11 February 1923 – 8 April 2010) was a British philosopher. Belonging to the analytic and evidentialist schools of thought, Flew worked on the philosophy of religion. During the course of his career he taught a ...

, 1994 * ''The End of the Welfare State'', Eamonn Butler & Madsen Pirie, 1994 * ''Readings in Liberalism'' (ed. Detmar Doering), 1995 * ''Hayek: A Commemorative Album'' (ed. John Raybould), 1998 * ''City in the Mist'', Douglas Mason, 1998 * ''Simply No Mistake: How the Stakeholder Pension Must Work'', Eamonn Butler, 1998 * ''The Future of the NHS'', Eamonn Butler (ed. Dr. Michelle Tempest), 2008 * ''Adam Smith – A Primer'', Eamonn Butler, 2007 * ''The Best Book on the Market'', Eamonn Butler, 2008 * ''Freedom 101'', Madsen Pirie, 2008 * ''The Rotten State of Britain'', Eamonn Butler, 2009 * ''Ludwig Von Mises: Fountainhead of the Modern Microeconomics Revolution'', Eamonn Butler & Jeff Riggenbach, 2010 (Audiobook) * ''Hayek: His Contribution to the Political and Economic Thought of Our Time'', Eamonn Butler & Jeff Riggenbach, 2010 (Audiobook) * ''The Alternative Manifesto'', Eamonn Butler, 2010 * ''Economics Made Simple'', Madsen Pirie 2012 * ''Think Tank'', Madsen Pirie 2012

Footnotes

References

External links

* {{Authority control Political and economic think tanks based in the United Kingdom Think tanks established in 1977 1977 establishments in the United Kingdom Organisations based in the City of Westminster Neoliberal organizations CANZUK