What this Nobel prize means

It's a nod in the direction of social science, rather than economics per se.  It's another homage to the New Institutional Economics and also to Law and Economics.  It's rewarding larger rather than smaller ideas, practical economics rather than abstract theory.  It's a prize somewhat outside of the mainstream.  As you probably know by now, Ostrom is a political scientist and she has spent much of her career at Indiana University.

I was delighted to hear of Ostrom winning (which I had not expected) but frankly it makes the omission of Gordon Tullock all the more glaring.

Here are interviews with Elinor Ostrom (recommended).  On Elinor Ostrom, here is Peter Boettke and on Williamson and Ostrom here is Lynne Kiesling.  Here are varied reactions.  Here is an excellent list of long links on Ostrom.  Here is Henry on Elinor Ostrom.

Check out Ostrom's cites on Google Scholar.


They cant be unknown in the USA ,but works by both have been translated into foreign language. I have read both

Economics per se? Part of economics includes institutional economics. Part of economics includes behavioural economics? Is the only "pure" economics mathematical economics or theoretical economics? This is a big tent. It even includes political economics.

Tullock should have won the Prize in 1986. But having been frozen out at that time - by Buchanan's successful lobbying efforts, according to what may (or may not) be urban legend - it is difficult to see how he could win it now. Is the Nobel Committee going to say "Oops, we are correcting an omission"?

The inside skinny on what happened with the Buchanan prize is that for whatever reason, Tullock was
somehow not all that high on the committee's radar screen at the time. The real issue was whether or
not the late Richard Musgrave, father of conventional public finance, and long a debater with Buchanan
about the proper way to do public economics, would share it with him. For whatever reason, they
decided not to give it to Musgrave (who never got one and is now dead), leaving Buchanan to get it

BTW, I went over and looked at that jobrumor blog linked into indirectly through this post. This is
the most depressing thread I think I have ever seen on an economics blog. It is an awful statement
about the low quality of grad econ education, not to mention the screaming arrogance of screamingly
ignorant people. Ack!

Peter, I trust you're right, but the fact that Buchanan thanked Tullock graciously would not necessarily be inconsistent with a desire to win the Prize alone.

As for economists who are complaining that Ostrom should not have won the Prize because (a) they have never heard of her and/or (b) she is a Political Scientist, they should be embarrassed by their own ignorance. The presumption that a political economist cannot contribute fundamental insights to economics is the worst kind of stupid academic chauvinism.

Looks like the bet on Fama at 2/1 proves something about the Efficient Market Hypothesis...that if the bet contained all the information in the market, and he lost, then

Correction: I shouldn't have posted twice, and it should read "unlike last year," not "like last year." I'm not a Krugman fan.

The first fact about Ostrom that struck me isn't that she's a woman or a political scientist, but that she works somewhere other than Berkley-Chicago-Ivy. Of course, Williamson is from Berkley.

I was rooting for a double Nobel for Alchian and Demsetz. They were pioneers in the application of economics to the insides of the firm, to the structure of the market, to private property, to the importance of governance, to the impact of competition, to the issues of hold-up and opportunism, to asset specificity, to the value of reputation when information is costly.

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