Set the Over/Under at the Comma

Mon, 12 Oct 2009 17:56:05 +0000

The Nobel Memorial Prize in Economics was awarded to Oliver Williamson and Elinor Ostrom today. Here is a write-up in The New York Times. I got as far as the comma before getting frustrated:

In a departure from prevailing economic theory, ...

There is no nice way to say just how badly this misconstrues the study of economics and its development as a field. Williamson's contributions are now part of the prevailing economic theory. Prior to his work, they were not. He merited the award precisely because of that change. Given the lag between when intellectual contributions are made and when they are recognized by the Nobel, his receipt of the award is not a surprise. Consider the betting pool at Harvard over the weekend, which had Williamson among the favorites.

Michael Spence (h/t Greg Mankiw) has a nice description of how the work of Williamson and Ostrom changed the prevailing economic theory of their day in a piece called "Markets Aren't Everything." Given her training in political science, Ostrom's work is less well known among economists. Here is a nice post at Marginal Revolution and here (h/t Will Wilkinson) is an interview from six years ago in which she and her husband describe their work.