more praise for Elinor Ostrom

When I started studying economics in graduate school, the standard operating procedure was to … assume a particular set of rules and technologies, as though they descended from the sky ….

A typical conclusion was that rules that assign property rights and rules that let people trade lead to good outcomes. … Why would they respect the property rights of someone else? We had no idea. ….

Elinor’s fieldwork, followed up by her experimental work, pointed us in exactly the right direction. ….

Economists … who think that they are doing deep theory but are really just assuming their conclusions, find it hard to even understand what it would mean to make the rules that humans follow the object of scientific inquiry. If we fail to explore rules in greater depth, economists will have little to say about the most pressing issues facing humans today – how to improve the quality of bad rules that cause needless waste, harm, and suffering.

Cheers to the Nobel committee for recognizing work on one of the deepest issues in economics. Bravo to the political scientist who showed that she was a better economist than the economic imperialists who can’t tell the difference between assuming and understanding.

Paul Romer, “Skyhooks versus Cranes: The Nobel Prize for Elinor Ostrom”, Charter Cities, 12 October 2009.

Stanford economist Paul Romer ‘invented’ endogenous growth theory.  He earned a BS in physics (1977) and a PhD in economics (1983), both from the University of Chicago, which makes his praise of Elinor Ostrom’s work all the more surprising, and more noble. This brief essay is outstanding, worth reading in its entirety. Highly recommended.

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