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Adam Smith
Adam Smith (baptised 16 June 1723 – died 17 July 1790 ) was a Scottish moral philosopher and a pioneer of political economics. One of the key figures of the Scottish Enlightenment, Smith is the author of The Theory of Moral Sentiments and An Inquiry into the Nature and Causes of the Wealth of Nations. The latter, usually abbreviated as The Wealth of Nations, is considered his magnum opus and the first modern work of economics. Smith is widely cited as the father of modern economics and capitalism.
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Alan Blinder
Alan Stuart Blinder (born October 14, 1945) is an American economist. He serves at Princeton University as the Gordon S. Rentschler Memorial Professor of Economics and Public Affairs in the Economics Department, Vice Chairman of The Observatory Group, and as co-director of Princeton’s Center for Economic Policy Studies, which he founded in 1990. Since 1978 he has been a Research Associate of the National Bureau of Economic Research. He is among the most influential economists in the world according to IDEAS/RePEc.
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Alfred Marshall
Alfred Marshall (born 26 July 1842 in Bermondsey, London, England, died 13 July 1924 in Cambridge, England) was an English economist and one of the most influential economists of his time, as one of the founders of neoclassical economics. His book, Principles of Economics (1890), became the dominant economic textbook in England for a long period. It brings the ideas of supply and demand, marginal utility and costs of production into a coherent whole.
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Friedrich Hayek
Friedrich August Hayek CH (8 May 189923 March 1992), born Friedrich August von Hayek, was an Austrian-born economist and philosopher best known for his defense of classical liberalism and free-market capitalism against socialist and collectivist thought. He is considered to be one of the most important economists and political philosophers of the twentieth century. Hayek's account of how changing prices communicate signals which enable individuals to coordinate their plans is widely regarded as an important achievement in economics. Hayek also produced significant work in the fields of systems thinking, jurisprudence, neuroscience and the history of ideas.
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George J. Stigler
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Jeremy Bentham
Jeremy Bentham ( or ; 15 February 1748 – 6 June 1832) was an English jurist, philosopher, and legal and social reformer. He became a leading theorist in Anglo-American philosophy of law and a political radical whose ideas influenced the development of welfarism. He is best known for his advocacy of utilitarianism and the ethical treatment of animals, and the idea of the panopticon.
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Kevin M. Murphy
Kevin Miles Murphy is the George J. Stigler Distinguished Service Professor of Economics at the University of Chicago Booth School of Business and a Senior Fellow at the Hoover Institution.
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Milton Friedman
Milton Friedman (July 31, 1912 November 16, 2006) was an American economist, statistician, a professor at the University of Chicago, and the recipient of the Nobel Prize in Economics. Among scholars, he is best known for his theoretical and empirical research, especially consumption analysis, monetary history and theory, and for his demonstration of the complexity of stabilization policy.
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Roland G. Fryer, Jr.
Roland Gerhard Fryer, Jr. (born June 4, 1977 in Daytona Beach, Florida) is a professor of economics at Harvard University. He also maintains offices at the National Bureau of Economic Research and W. E. B. Du Bois Institute. In January 2008, at age 30, he became the youngest African-American to ever receive tenure at Harvard.
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Steven Levitt
Steven David "Steve" Levitt (born May 29, 1967) is an American economist known for his work in the field of crime, in particular on the link between legalized abortion and crime rates. Winner of the 2004 John Bates Clark Medal, he is currently the William B. Ogden Distinguished Service Professor of Economics at the University of Chicago, director of the Becker Center on Chicago Price Theory at the University of Chicago Booth School of Business, and co-editor of the Journal of Political Economy published by the University of Chicago Press. He co-authored the best-selling book Freakonomics (2005) and its sequel Superfreakonomics (2009). In 2009, Levitt co-founded [http://www.greatestgood.com The Greatest Good], a business and philanthropy consulting company. He was chosen as one of Time magazine's "100 People Who Shape Our World" in 2006.
http://wn.com/Steven_Levitt
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Columbia University in the City of New York (Columbia University) is a private research university in New York City and a member of the Ivy League. Columbia is the oldest institution of higher learning in the state of New York, the fifth oldest in the United States, and one of the country's nine Colonial Colleges founded before the American Revolution. It was founded in 1754 as King's College by royal charter of George II of Great Britain, and is one of only three United States universities to have been founded under such authority.
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Princeton University is a private research university located in Princeton, New Jersey, United States. The school is one of the eight universities of the Ivy League, and is one of the nine Colonial Colleges founded before the American Revolution.
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The Leland Stanford Junior University, commonly referred to as Stanford University or Stanford, is a private research university located in Stanford, California, United States. The university is located on an campus in northwestern Santa Clara Valley approximately southeast of San Francisco and approximately northwest of San Jose.
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The United States of America (also referred to as the United States, the U.S., the USA, or America) is a federal constitutional republic comprising fifty states and a federal district. The country is situated mostly in central North America, where its forty-eight contiguous states and Washington, D.C., the capital district, lie between the Pacific and Atlantic Oceans, bordered by Canada to the north and Mexico to the south. The state of Alaska is in the northwest of the continent, with Canada to the east and Russia to the west across the Bering Strait. The state of Hawaii is an archipelago in the mid-Pacific. The country also possesses several territories in the Caribbean and Pacific.
http://wn.com/United_States
- Alan Blinder
- Alfred Marshall
- altruistic behavior
- Bachelor of Arts
- Business Week
- Casey Mulligan
- Columbia University
- Conservatism
- crime
- criminology
- deadweight loss
- drug addiction
- economics
- economist
- EconTalk
- family (economics)
- Family economics
- Friedrich Hayek
- George J. Stigler
- historian
- Hoover Institution
- human capital
- immigration tariff
- Jeremy Bentham
- Kevin M. Murphy
- Latin America
- List of economists
- Middle East
- Milton Friedman
- neoliberalism
- panopticon
- Princeton University
- Rational addiction
- Richard Posner
- Roland G. Fryer, Jr.
- Rotten kid theorem
- Social capital
- Social economics
- sociology
- Stanford University
- Steven Levitt
- United States
- weblog


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- Adam Smith
- Alan Blinder
- Alfred Marshall
- altruistic behavior
- Bachelor of Arts
- Business Week
- Casey Mulligan
- Columbia University
- Conservatism
- crime
- criminology
- deadweight loss
- drug addiction
- economics
- economist
- EconTalk
- family (economics)
- Family economics
- Friedrich Hayek
- George J. Stigler
- historian
- Hoover Institution
- human capital
- immigration tariff
- Jeremy Bentham
- Kevin M. Murphy
- Latin America
- List of economists
- Middle East
- Milton Friedman
- neoliberalism
- panopticon
- Princeton University
- Rational addiction
- Richard Posner
- Roland G. Fryer, Jr.
- Rotten kid theorem
- Social capital
- Social economics
- sociology
- Stanford University
- Steven Levitt
- United States
- weblog
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Coordinates | 51°37′28″N3°58′58″N |
---|---|
name | Gary Becker |
school tradition | Chicago school of economics |
color | maroon |
birth date | December 02, 1930 |
nationality | American |
institution | University of Chicago(1968–present)Columbia University(1957–1968) |
field | Social economics |
alma mater | Princeton UniversityUniversity of Chicago |
influences | Friedrich HayekMilton Friedman |
influenced | Casey MulliganSteven LevittRoland G. Fryer, Jr. |
contributions | Analysis of human capitalRotten kid theorem |
awards | 2007 Presidential Medal of Freedom1992 Nobel Memorial Prize in Economic Sciences1967 John Bates Clark Medal1997 Pontifical Academy of Sciences |
signature | |
repec prefix | e | repec_id pbe29 }} |
Becker was one of the first economists to branch into what were traditionally considered topics belonging to sociology, including racial discrimination, crime, family organization, and drug addiction (see Rational addiction). He is known for arguing that many different types of human behavior can be seen as rational and utility maximizing. His approach can include altruistic behavior by defining individuals' utility appropriately. He is also among the foremost exponents of the study of human capital. Becker is also credited with the "rotten kid theorem". He is married to Guity Nashat, a historian of the Middle East whose research interests overlap his own.
Biography
Born in Pottsville, Pennsylvania, Becker earned a B.A. at Princeton University in 1951 and a Ph.D. at the University of Chicago in 1955. He taught at Columbia University from 1957 to 1968, and then returned to the University of Chicago. Becker is a founding partner of The Greatest Good, a business and philanthropy consulting company. Becker won the John Bates Clark Medal in 1967. He was elected a Fellow of the American Academy of Arts and Sciences in 1972. Becker also received the National Medal of Science in 2000.Usually considered politically conservative, he wrote a monthly column for Business Week from 1985 to 2004, alternating with liberal Princeton economist Alan Blinder. In December 2004, Becker started a joint weblog with Judge Richard Posner entitled The Becker-Posner Blog.
Nobel Memorial Prize
According to the Prize in Economic Sciences citation, his work can be categorized into four areas:Becker’s lecture, "Nobel Lecture: The Economic Way of Looking at Behavior", subsequently published in the Journal of Political Economy, reviews his four key areas of research. He explains that his framework of analysis is not a traditional self-interested motivation, but rather an analysis based on a set of assumptions and individual preferences. Yes, agents are maximizing welfare but it is based on individual conception constrained by income, time, and imperfect memory and calculation capabilities. Much of his research focuses on the impact of the rising value of time as a result of economic growth.
Discrimination
Becker often includes a variable of taste for discrimination in explaining behavior. He believes that people often mentally increase the cost of a transaction if it is with a minority they discriminate against. His theory held that competition decreases discrimination. If firms were able to specialize in employing mainly minorities and offer a better product or service, such a firm could bypass discrepancy in wages etc. between equally productive blacks and whites or females and males.Becker’s research found that when minorities are a very small percentage the cost of discrimination mainly falls on the minorities. However, when minorities represent a larger percentage of society then the cost of discrimination falls on both the minorities and the majority. He also pioneered research on the impact of self-fulfilling prophecies of teachers and employers on minorities. Such attitudes often lead to less investment in productive skills and education of minorities.
Crime and punishment
Becker’s interest in criminology arose when he was rushed for time one day. He had to weigh the cost and benefits of legally parking in an inconvenient garage versus in an illegal but convenient spot. After roughly calculating the probability of getting caught and potential punishment, Becker rationally opted for the crime. Becker surmised that other criminals make such rational decisions. However, such a premise went against conventional thought that crime was a result of mental illness and social oppression.While Becker acknowledged that many people operate under a high moral and ethical constraint, criminals rationally see that the benefits of their crime outweigh the cost such as the probability of apprehension, conviction, and punishment, as well as their current set of opportunities. From the public policy perspective, since the cost of increasing the fine is trivial in comparison to the cost of increasing surveillance, one can conclude that the best policy is to maximize the fine and minimize surveillance. However, this conclusion has limits, not the least of which include ethical considerations.
One of the main differences between this theory and Jeremy Bentham's rational choice theory, which had been abandoned in criminology, is that if Bentham considered it possible to annihilate crime completely (through the panopticon), Becker's theory acknowledged that a society could not eradicate crime beneath a certain level. For example, if 25% of a supermarket's products were stolen, it would be very easy to reduce this rate to 15%, quite easy to reduce it until 5%, difficult to reduce it under 3%, and nearly impossible to reduce it to zero (a feat that would cost the supermarket so much in surveillance, etc. that it would outweigh the benefits even if it were possible).
Human capital
Becker’s research was fundamental in arguing for the augmentability of human capital. When his research was first introduced it was considered very controversial as some considered it debasing. However, he was able to convince many that individuals make choices of investing in human capital based on rational benefits and cost that include a return on investment as well as a cultural aspect.His research included the impact of positive and negative habits such as punctuality and alcoholism on human capital. He explored the different rates of return for different people and the resulting macroeconomic implications. He also distinguished between general to specific education and their influence on job-lock and promotions.
Families
Becker’s research on human social interactions has had many implications for the family such as for the marriage market, divorce, fertility, and social security. Becker argued that such decisions are made in a marginal-cost and marginal-benefit framework. For example, he concluded that wealthier couples have higher cost to divorce and thus a lower divorce rate.A major focus of Becker’s research was the impact of higher real wages in increasing the value of time and therefore the cost of home production such as childrearing. As women increase investment in human capital and enter the work force the opportunity cost of childcare rises. Additionally, the increased rate of return to education raises the desire to provide children with formal and costly education. Coupled together, the impact is to lower fertility rates.
A more controversial issue was Becker’s conclusion that parents often act altruistically towards selfish children by highly investing in a child in an effort to indirectly save for old age. Becker believed that the rate of return from investing in children was often greater than normal retirement savings. However, parents can not know for sure that the child will take care of them. Since they cannot legally bind a child to care for them they often resort to manipulation through instilling a sense of “guilt, obligation, duty and filial love that indirectly, but still very effectively... commits children to helping them out.” Becker even went so far as to say that social security can cause families to be less interdependent by removing the motivation of parents to use altruistic behaviors in motivating their children to care for them.
Organ markets
An article by Gary Becker and Julio Elias on "Introducing Incentives in the market for Live and Cadaveric Organ Donations" said that a free market could help solve the problem of a scarcity in organ transplants. Their economic modeling was able to estimate the price tag for human kidneys ($15,000) and human livers ($32,000). It is argued by critics, that this particular market would exploit the underprivileged donors from the developing world. This view was endorsed by the National Kidney Foundation in a testimony to the US Congress where Dr Francis Delmonico argued that "...a US congressional endorsement for payment would propel other countries to sanction unethical and unjust standards...". Another concern is that, if a market for organ donations were introduced, then organs would oftentimes go to the patients most able to afford them, rather than patients who may have more need for them medically.
Politics
Becker is also famous for his economic analysis of democracy. He asked what determines the extent to which an interest group can exploit another. The basis of his analysis was the concept of deadweight loss.Becker’s insight was to recognize that deadweight losses put an exponential break on predation. He took the well-known insight that deadweight losses are proportional to the square of the tax, and used it to argue that a linear increase in takings by a predatory interest group will provoke a non-linear increase in the deadweight losses its victim suffers. These rapidly increasing losses will prod victims to invest equivalent sums in resisting attempts on their wealth. The advance of predators, fueled by linear incentives slows before the stiffening resistance of prey outraged by non-linear damages.
He is also noted for his advocacy of immigration tariffs, and for his staunch defense of the consequences of neoliberalism in Latin America.
Quotations
"My teachers taught me that economics was not a game played by clever academics, but a serious subject that helped us understand the real world we lived in. You can do economics and do it in a rigorous way and nevertheless talk about important problems."
Publications
(Description. Scroll down to chapter-preview links.) (UCP descr)
See also
References
External links
Category:1930 births Category:American bloggers Category:American economists Category:American libertarians Category:American Nobel laureates Category:Columbia University faculty Category:Libertarian economists Category:Living people Category:Microeconomists Category:Fellows of the American Academy of Arts and Sciences Category:Fellows of the Econometric Society Category:Members of the Pontifical Academy of Sciences Category:Members of the United States National Academy of Sciences Category:Mont Pelerin Society members Category:National Medal of Science laureates Category:Nobel laureates in Economics Category:People from Pottsville, Pennsylvania Category:Presidential Medal of Freedom recipients Category:Princeton University alumni Category:University of Chicago alumni Category:University of Chicago faculty
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