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Economics Nobel Prize Award a Nod to Sustainability

Two U.S. academics have just been awarded the Nobel Prize for Economics, with the Prize Committee noting the winner’s work in economic governance. One winner is Elinor Ostrom–the first woman to land the prestigious prize.

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Elinor Ostrom and Oliver E. Williamson

The other winner is Oliver E. Williamson of University of California, Berkeley, who was particularly cited by the committee as being important for his analysis of “the boundaries of the firm.” Working with the Theory of the Firm, Williamson’s credited with a number of important pieces of study, but the ones the Prize Committee really are rewarding relate to a number of ideas Williamson’s put forward which suggest that the way businesses work allows them to “serve as structures for conflict resolution.”

Elinor Ostrom, the other winner, was credited for work showing how “common property can be successfully managed by user associations”–a body of knowledge that ties back to some of her early work, such as her dissertation on water associations which pushed for changes to prevent dangerous salination of Los Angeles ground water reserves. And, behind the dry economic description, that’s where this Nobel Prize actually gets intriguing: It’s a tacit nod in support of sustainability.

Ostrom’s work in Nepal has demonstrated that farmer-led systems can be much better than government-managed ones, and more recently she’s been working with forestry bodies to ensure the best systems are in place to enable sustainable resource management.

Both recipients will share the $1.4 million cash reward that goes with the Prize, and how they use this money is likely to be way less controversial than another recent winner.

[via the The New York Times]

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