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Elinor Ostrom wins Nobel economics prize for work on the commons
Key Excerpts from Article on Website of Forbes magazine
Posted: March 8th, 2010
http://www.forbes.com/2009/10/12/nobel-prize-economics-elino...
While many economists [have long assumed] that collective action [doesn't] work, several decades ago the Indiana University ... political scientist [Elinor Ostrom] began to study when and why it did work. [Now,] her efforts [have] won her the 2009 Nobel economics prize. "What Ostrom showed was that a lot of ordinary ... people who'd never read about free rider problems basically developed institutional arrangements," says Nancy Folbre, an economics professor at the University of Massachusetts Amherst. Groups of fishermen figured out how to limit their catch, while farmers collaborated on irrigation problems. "Sure there's a free-rider problem, but people turn around and find ways to solve it," Folbre says. Ostrom ... looked at other institutional successes, studying group-run fisheries, pastures, woods and lakes, to conclude that "outcomes are, more often than not, better than predicted by standard theories." She "challenged the conventional wisdom that common property is poorly managed and should be either regulated by central authorities or privatized," the Nobel committee said. Why did other economists miss this part of the picture? "Economists didn't pay attention to ethnography," Folbre says--that is, they didn't observe actual people at work. "Why go out in the field when you have a nice theory?"
Note: Elinor Ostrom was also the first woman to win the Nobel in economics, as described in this CNN article.
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