ASU prof wins economics honor

You thought giving the peace prize to a sitting commander-in-chief was bad? Wait until you hear the winner of the non-Nobel in economics – it’s a Sun Devil!

Arizona State University Research Professor Elinor Ostrom has won this year’s Nobel Memorial Prize in Economic Sciences, a prize she shares with Oliver E. Williamson of the University of California at Berkeley.

Ostrom, who holds research positions at Arizona State University and Indiana University, is one of three faculty members at ASU to be a Nobel Prize recipient and the second in economics. Edward C. Prescott won the 2004 Nobel Prize in Economic Sciences and Leland “Lee’ Hartwell won the 2001 Nobel Prize for Physiology or Medicine before joining the ASU faculty this fall.

Actually, Ostrom’s work is pretty awesome, Tempe affiliations aside. The summary of her work, from Marginal Revolution:

With her husband, political scientist Vincent Ostrom, she established the Workshop in Political Theory and Policy Analysis in 1973 at Indiana University, an extraordinarily productive and evolving association of students and professors which has produced a wealth of theory, empirical studies and experiments in political science and especially collective action.  The Ostrom’s work bridges political science and economics.  Both are well known at GMU since both have been past presidents of the Public Choice society and both have been influenced by the Buchanan-Tullock program.  You can also see elements of Hayekian thought about the importance of local knowledge in the work of both Ostroms (here is a good interview).  My colleague, Peter Boettke has just published a book on the Ostrom’s and the Bloomington School.

Elinor Ostrom’s work culminated in Governing the Commons: The Evolution of Institutions for Collective Action which uses case studies to argue that around the world private associations have often, but not always, managed to avoid the tragedy of the commons and develop efficient uses of resources.  (Ostrom summarizes some of her findings from this research here).  Using game theory she provided theoretical underpinnings for these findings and using experimental methods she put these theories to the test in the lab.

For Ostrom it’s not the tragedy of the commons but the opportunity of the commons.  Not only can a commons be well-governed but the rules which help to provide efficiency in resource use are also those that foster community and engagement.  A formally government protected forest, for example, will fail to protect if the local users do not regard the rules as legitimate.  In Hayekian terms legislation is not the same as law.  Ostrom’s work is about understanding how the laws of common resource governance evolve and how we may better conserve resources by making legislation that does not conflict with law.

Good stuff. Ostrom has also been instrumental in setting up a satellite workshop at ASU, the Center for the Study of Institutional Diversity. Econ-geeks – and political nerds (her only degrees are in political science!) – will find plenty of time-killing possibilities in the above links.