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Human Capital Declines Dramatically: Nobel Laureate Gary Becker Passes Away at 83

By: Alexandra Woodfin - May 5, 2014, 8:21 am

EspañolGary Becker, a Nobel Laureate in economics and University of Chicago economist and sociologist, passed away on May 3 from complications after a recent surgery. Becker achieved recognition as an innovative academic who synthesized disciplines, and Milton Friedman even went so far as to call him “the greatest social scientist who has lived and worked in the last half century.”

Tom Palmer, executive vice-president of international programs at the Atlas Network, commented that “the stock of human capital declined dramatically” with Becker’s passing. Those familiar with Becker’s work will recognize a subtle reference to his contributions to the ideas of human capital, an area that was still “fledgling” when he started developing it the early 1960s.

Human Capital by Gary Becker

Becker’s status as a famed and esteemed economist reached a climax when he received the 1992 Nobel Prize in Economics. The award came after he “extended the domain of economic theory to aspects of human behavior which had previously been dealt with — if at all — by other social science disciplines such as sociology, demography, and criminology.”

Becker’s insight that education is an investment in human capital was new at the time, but is mere common sense today. Further, his insights on crime, family economics, marriage, and discrimination (the latter being the topic of his dissertation) were so influential that they created new fields of economic research.

A Treatise on the Family by Gary Becker

Originally from Pennsylvania, Becker completed an undergraduate mathematics degree in three years at Princeton University, summa cum laude. There he “accidentally took a course in economics,” according to his University of Chicago faculty bio, and said that he was “greatly attracted by the mathematical rigor of a subject that dealt with social organization.”

He admitted, however, to losing interest in economics during his final year at Princeton, noticing that it did not seem to deal with important social issues. Milton Friedman, who became his “enthusiastic mentor,” renewed Becker’s interest by reminding him that economics was a “powerful tool to analyze the real world.”

In his autobiography, Becker remarked that “for a long time my type of work was either ignored or strongly disliked by most of the leading economists. I was considered way out and perhaps not really an economist.” James Heckman, a colleague, friend, and fellow Laureate noted that Becker “persevered in a scholarly way.… He didn’t just listen to the critics — he responded to the critics. It always enriched him.”

Academically well-rounded, Becker taught at Columbia University from 1957 to 1969, before spending the rest of his academic career at the University of Chicago with joint appointments in economics and sociology. During that early period, he was also the 1967 recipient of the John Bates Clark Medal of the American Economic Association, reserved for American economists under 40 who are “judged to have made the most significant contribution to economic thought and knowledge.” He went on to become president of the American Economic Association in 1987.

Gary Becker (1930-2014)
Gary Becker (1930-2014). Source: Confucius Institute.

His dedication to economics “pervaded every aspect of Becker’s life,” as noted in a UChicago News obituary. He met his second wife haggling over the price of a dining room set, and later remarked, “I didn’t care about getting the money. But it was the principle, I did not want to sell it below what it was worth.”

As Milton Friedman invested in Becker’s human capital as a scholar and human being, Becker invested in others. Students, peers, and colleagues alike have come forward to speak highly of him as an intellectual and individual. Michael Strong, CEO of FLOW and an educational entrepreneur, did his doctoral work with Becker and describes him as a “very great human being, with a human decency and integrity that is very rare.”

He suffered tremendous verbal abuse for both his academic work and for his public advocacy of free market positions, but bore both with equanimity and kept working steadily to make the world a better place.… He was always supportive of my efforts to apply entrepreneurial strategies to make the world a better place, including startup cities. Now that he is gone, Vernon Smith may be the only living Nobel laureate who remains a forthright advocate of economic freedom for global poverty alleviation.

Greg Mankiw, chairman of the Harvard University Economics Department, wrote that from his limited interactions with Becker, he seemed to be “a truly nice man as well as a path-breaking scholar.” University of Chicago President Robert Zimmer also commented that “he was intellectually fearless. As a scholar and as a person, he represented the best of what the University of Chicago aspires to be.”

Editor’s note: Gary Becker was particularly important in the intellectual development of many PanAm Post staff members. We acknowledge the value of his legacy and send our condolences to his family and those near to him.

Alexandra Woodfin Alexandra Woodfin

Alexandra Woodfin is a PanAm Post intern and undergraduate at Towson University, studying economics and French. Originally from Annapolis, Maryland, she looks forward to traveling and using her language skills to continue learning about the world after graduation. Follow @akwoodfin.