Austin — When the University of Texas set up the Institute for Constructive Capitalism , some critics quickly put it in the corporate propaganda camp. After all, its name didn't do much to dispel that notion. Nor did locating it in laissez-faire Texas.
Yet today the institute, known here in exponential form as IC , is slowly emerging as a no-nonsense evaluator of the nation's economic health.
In a cubicled fourth-floor room of the university's graduate school of business, researchers explore the roots of capitalism, its current status, and ways it can be improved. At any given time some 40 people, blue-jeaned graduate students and pinstriped professors are working on projects.
Even by its own yardstick the institute is far from achieving one of its original goals: to be a respected advocate of private enterprise. Yet the reports from this self-styled economic think tank are being more widely circulated in Washington and some corporate boardrooms.
The group has sponsored workshops on topics like the Texas economy and small businesses and entrepreneurship. The institute has put out 250 to 300 papers and studies in five years; only a few have been called shallow.
Established in 1977, the Institute for Constructive Capitalism is the concept of George Kozmetsky, dean of the Graduate School of Business and the College of Business Administration. A small but energetic man who likes to jot notes on a legal pad, Dr. Kozmetsky sees the institute as one of the few academic centers involved in purely ''objective'' research of the capitalist system.
Besides professors and a few businessmen, the institute draws heavily for its research support from graduate students - what Dr. Ruefli calls a ''pool of highly skilled, relatively cheap labor.'' Last year the institute's budget totaled about $700,000. The funds represented income from an endowment as well as donations from corporations, foundations, and private individuals.
Among a few of the projects researchers are working on:
* Mr. CEO takes up a clipboard. The institute brings in executives for several weeks to focus on a particular research topic. One businessman from the San Antonio-based Datapoint Corporation worked on a new plan for organizing data processing in his company. Another devised a marketing strategy for an oil pump rig. This fall the institute is expected to bring in four ''corporate scholars'' (companies pay a $6,000 fee for the program).
* Tracing corporate trees. Researchers here have been collecting information on the acquisitions, mergers, reorganizations, and financial status of the country's top 1,500 corporations. Once the computerized model is completed, the institute will be able to probe a variety of theories about corporate behavior. One preliminary conclusion so far: Contrary to what many believe, the nation's biggest companies have grown more by expanding internally than by gobbling up other firms.
* Free enterprising the third world. Researchers are exploring ways to measure and sustain the economies of less developed countries, including ways for the private sector to stimulate growth. They will also consider what kinds of trade the developed countries should be carrying on with third-world countries.