Becker, Gary S. (1930–)

Gary S. Becker received the Nobel Prize in Economic Sciences in the year1992: “For having extended the domain of microeconomic analysis to a wide range of human behavior and interaction, including nonmarket behavior.” With his new perspective, he widened the scope of economic sciences and at the same time added numerous insights to the human behavior research and the field of anthropology.

Becker considers economics not as a science that deals with a specific subject matter. For him, economics is a specific method that can be applied to all areas of human life. The basic assumptions of his approach are based on the rational choice model: maximizing behavior of human beings, stable preferences in regard to the central aspects of life, and the existence of markets where the allocation of scarce resources is coordinated and a market equilibrium is reached. At the same time, Becker acknowledges the wide range of human interests as basis for maximizing behavior and does not focus just on selfishness or gain like other economic research in the past.

On the basis of these assumptions, Becker reached well-accepted models about human behavior, within the family or in regard to crime, as well as further explanations for several human characteristics such as altruism.

Gary S. Becker was born in 1930 in Pottsville, Pennsylvania. He studied at Princeton with a focus on mathematics and economics. Later in his studies, he nearly lost interest in economics, since it did not seem to deal with crucial social questions.

For his graduate work, he decided to go to the University of Chicago. The encounter with Milton Friedman and his approach to economics as a “tool to analyze the real world” renewed Becker's fascination for economics.

Becker's first larger publication, The Economics of Discrimination, was based on his PhD thesis (1955) and came out in 1957. Within this work, Becker applied the economic view to analyze the effects of prejudices concerning minorities on their earnings, employment, and occupations. Becker concluded that discrimination leads to economic disadvantages for the person discriminated against as well as for the person practicing discrimination.

After he finished his third year of graduate study, Becker received an assignment as assistant professor [Page 337]at Chicago. To become more independent, he left Chicago 3 years later and accepted a position at Columbia University and the National Bureau of Economic Research. In the following 12 years, he taught at Columbia and did research at the bureau, especially on the subject of human capital. Based on existing research, Becker developed a general theory on human capital. The theory answers the question of how investments in human competence, as in the case of education, can be explained, and what consequences these investments imply. As a result of these activities, he published his book Human Capital in 1964. Today, his theory has a wide application. It helps to explain human behavior in regard to education, migration, as well as investments and earnings in the health sector. Empirical data have shown the huge impact of human capital on real-world phenomena.

Other research projects of Becker in this period resulted in frequently cited articles, for example, on the allocation of time, irrational behavior, or crime and punishment. Becker's view on crime as a possible rational behavior helped to find new concepts to explain and to prevent crime.

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