Gary S. Becker, Awarded Nobel Prize in 1992,

Lecture presented April 13, 2000.

Gary Becker’s research has opened up areas of study that were formerly the concern mostly of sociologists, anthropologists and psychologists. He has made original contributions to the economics of discrimination, crime and punishment, and addiction. Becker was among the first to develop the implications of human capital theory and his research on the allocation of time led to a complete explanation of virtually all aspects of family behavior including marriage, divorce, and the decision to have and to educate children.

The Nobel Committee recognized Professor Becker “for having extended the domain of microeconomic analysis to a wide range of human behavior and interaction, including nonmarket behavior.”

Quotes from Gary Becker’s April 2000 lecture at Trinity University:

So I was doing well in economics. During my senior year at Princeton, however, I was losing interest in economics and began to think that I should go into something else. Economics seemed excessively formal to me. I’m sure that cannot be true of anything you have been reading as students nowadays, but then that is how it seemed to me. Economics appeared incapable of helping me understand the issues in which I had an interest: inequality, class, race, prestige, and similar issues that were important for society. A sociology professor at Princeton suggested I look at Talcott Parsons’ Structure of Social Action. Parsons, then the dominant figure in American sociology, started his career as an economist and believed that social theory included economics as a special case. I tried to read this book, but it contained an enormous quantity of jargon that did not lead anywhere, or at least anywhere that I could follow. I concluded that sociology was too hard, and returned, somewhat reluctantly, to economics. I remained unhappy – unhappy by what seemed to me a disconnect between what economists would talk about in textbooks and elsewhere and what I wanted to talk about.

I decided nevertheless to go on for a doctorate in economics. Adlai Stevenson once defined a graduate student as someone who didn’t know when the party was over. … I consider that from a professional point of view the decision to go to Chicago probably the most important decision I ever made. The atmosphere at Chicago was enormously stimulating. Milton Friedman became the greatest influence of any individual on my development as an economist. Attending his graduate course in price theory was just exciting and I would eagerly wait for that course to come twice a week. … Here I saw economics as a tool and not simply as a game played by clever academics, which is what had worried me most about economics. … It was a great course and it showed me what I thought was not possible. You can do economics and do it in a rigorous way and nevertheless talk about important problems. … Indeed I developed the Chicago chip-on-the-shoulder attitude that economics could unlock the mysteries of the real world. Rightly or wrongly, it was a great feeling to have. … I began to believe this as a graduate student. I still believe that it is true.

I initially had expected economists to applaud attempts to widen the scope of their field. I was surprised that the main hostility to my work, at least as it was explicitly stated, came from economists, not non-economists. I began to realize that my original view was naive. All disciplines have a strong and I think probably justified degree of intellectual conservatism. You do not give up ideas and concepts you have held for a long time without a fight. It is necessary to fight to get new ideas accepted. Even after I became aware of the extent of the hostility, I remained confident that the contribution of the economic approach to broader problems would eventually be recognized. … There were two reasons why I remained confident. First, it just seemed to me obvious that economics could contribute to these areas. … The other factor was that I was fortunate to have intellectually powerful people on my side. I gained strength from the support of senior economists I greatly respected.

I started my work on human capital at Columbia and the National Bureau of Economic Research. … I told Fabricant [director of the Bureau] that I would like to do a study on the rates of return to education and training. ... I set about trying to sketch out a small set of foundations to give the work theoretical content. … I had no vision at all of what this would lead to. Once again, here is an example of the role of luck. As I delved into the theory and tried to develop a basic foundation for human capital investment, it looked to me that the theory could explain a lot about the way earnings rise with age (a concave age-earnings profile), the effect of education on the distribution of earnings, externalities of human capital, and many other issues that continue to this day to be discussed and debated. I was amazed and then greatly excited when I began to realize that this framework could integrate scores of observations and regularities in individual earnings, occupational differences in earnings, and employment.

So the long years of fighting attacks were largely over, although the official Nobel announcement called my work controversial. … And so, it was a great week and a great period of recognition. Some people have studied Nobel Laureates and discovered that they did a whole lot less work after receiving the prize than before. … I resolved to continue to do research and not change my life drastically. … I hope that in my case the iron law of the negative effect of the Nobel Prize on productivity has been overcome.

Additional resources on Gary Becker are available at the Nobel web site.

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