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Nobel Prize winner: Becker (Who? (B.A. Princeton (1951), Ph.D. Chicago…
Nobel Prize winner: Becker
Who?
B.A. Princeton (1951), Ph.D. Chicago (1955)
Professor University of Chicago since 1968
1930 – 2014
Nobel Prize in 1992 : "for having extended the domain of microeconomic analysis to a wide range of human behaviour and interaction, including nonmarket behaviour”
“Economics is a dialogue between theory and data and should never be either one or the other”
Following Haavelmo and Koopmans he believed measurements need to be guided by theory.
Like Friedman’s “Methodology of Positive Economics” (1953) he also rejected a purely theory-based (deductive) approach to economics.
Rejected the purely inductive approach that “facts could speak for themselves”.
Abductive approach
Economic imperialism -1
Extending economic approach to topics that go beyond the classical scope of issues
(e.g. consumer choice, theory of the firm, markets, macroeconomic activities)
Typically, those new areas were not characterized by markets or prices
(e.g. sociology, political science, law, social biology, anthropology)
Economic imperialism -2
Main economic principles
(ii) Importance of equilibrium as part of a theory
(iii) Emphasis on efficiency
allow complicated problems to be written in simple, abstract terms.
(i) maximizing, rational behavior
“Weakness of economics is that to be rigorous, simplifying assumptions must be made that constrain the analysis and narrow the focus of the researcher. It is for this reason that the broader-thinking sociologists, anthopologists, and perhaps psychologists may be better at identifying issues, but worse at providing answers.” (Lazear, 2000)