Gary S. Becker - Expensivity

Becker’s Early Life and Education

Gary S. Becker (1930–2014) was born in Pottsville, Pennsylvania, a small town in the Allegheny Mountains, north of Reading and about halfway between Harrisburg and Allentown. His family was Jewish.

Becker obtained his bachelor’s degree in economics in 1951 from Princeton University, with a senior thesis on international trade.

Becker received his PhD in economics in 1955 from the University of Chicago, where he worked with Milton Friedman, among others. His dissertation, entitled “The Economics of Discrimination,” was published as a book two years later, in 1957 (see “Selected Works by Becker” below).

Becker’s Career

Upon graduation, Becker was able to remain at Chicago for a couple of years, teaching and conducting research. Then, in 1957, he obtained his first regular teaching position in the economics department at Columbia University in New York City.

During his time in New York, Becker also conducted research at the National Bureau of Economic Research (NBER). In 1967, he received the John Bates Clark medal for the best American economist under the age of 40.

In 1970, Becker was invited to return to economics department at Chicago, where he spent the rest of his career. In 1983, he also received a joint appointment with the sociology department.

In 1992, Becker was awarded the Nobel Memorial Prize in Economic Sciences.

In addition to his academic work, Becker was concerned to present his economic ideas to a wider public. To this end, he wrote a monthly column for Business Week from 1985 until 2004.

In that year, 2004, Becker began to contribute to a joint blog, entitled The Becker-Posner Blog, with Richard A. Posner, formerly a judge with the US Court of Appeals for the Seventh Circuit and a well-known public intellectual.

Becker’s Ideas

Becker is considered to be one of the founding fathers of “the Chicago school of economics.” His personal contribution lay in the extension of classical economic analysis to social phenomena which had not been very much studied from an economic point of view up to his time.

By common consensus, Becker’s masterpiece is Human Capital, originally published in 1964 (see below). In that classic work, Becker demonstrated how a family’s or an individual’s payment for education and training is formally analogous to a business firms’ investment in the equipment it requires to conduct its business operations.

In addition, as already alluded to above, Becker pioneered the application of mainstream economic ideas to the analysis of human conduct in a wide variety of underexplored social institutions and situations, including marriage, family relations, education, crime and punishment, racial discrimination, and incentives for immigration.

For example, Becker laid the foundation for the study of households as productive entities analogous to business firms. His papers and books exploring the allocation of time and goods within the household unit of production contributed to a large literature by a cohort of younger economic researchers.

Becker’s work on this and many other social phenomena has had an extensive and ongoing influence, not only on the discipline of economics, but on sociology and other social sciences, as well.