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Monday links: fear of the unknown
Abnormal Returns — ... central banks didn’t blow asset bubbles in the first place?  (Economics One) Why are companies quitting the U.S. Chamber of Commerce?  (New Yorker, The Balance Sheet) A pair of 50/1 shots win the Nobel prize in Economics. (WSJ, Clusterstock, Real Time Economics, EconLog, Marginal Revolution, Dynamist) An Apple ...

Nobel to Ostrom and Williamson
TRUTH ON THE MARKET — ... , who contributed a significant amount to the literature on the boundaries of the firm, asset specificity, and transaction costs. Alex Tabarrok has helpful summaries on Ostrom and ...

2009 Nobel Prizes
Aguanomics — ... different than the theoretical financial and macroeconomics that gave intellectual support to the idiots who played big roles in the global economic disaster that has hurt so many people; see this post and this post Bottom Line: Ostrom and Williamson deserve the Nobel for doing the best kind of economics -- the economics that enlightens us and gives us ways to improve our lives. Addendum: Lynne Kiesling, Alex Tabarrok (Ostrom) (Williamson) and Tim Haab on the prize. ...

Ostrom and Williamson
Division of Labour — Start with a Pigovian question: what to do about externality? Entertain a Coasean solution: bargain it away. Get stuck on transaction costs due to a Buchanan problem: collective action. Arrive at this year's Nobel: voluntary collective action can and often does work toward the emergence of good institutions. It's not private property rights per se, but well-defined and enforced rules of exclusion, which support beneficial social organization. As Alex Tabarrok aptly puts it , for Ostrom it's not the tragedy of the commons but the opportunity of the commons. For Williamson, ...

Congratulations on Nobel
SCSUScholars — ... So my answer to Margaret is simple -- hang around with economists more. We balance Ostrom, whose work nevertheless spawned the very useful field work that many development economists do today, as Alex Tabarrok notes. Since my comparative systems class has been reading Douglass North (whose work is also akin to Williamson's and Ostrom's) I will be working up a new lecture for tomorrow. ...

The Ostrom Nobel
Crooked Timber — ... a normative approach to governance which stresses the degree to which higher levels of government should not crowd out self-organization at lower levels. Her work implies that both pure marketization and top-down government control can have badly adverse consequences for resource management, because they rob individuals of the capacity to govern themselves, and because they both lead to the depletion of important forms of local collective knowledge. Alex Tabarrok is right to see something Hayekian in Ostrom’s arguments – but it is Hayek against Hayek. ...

Oliver Williamson and Elinor Ostrom Awarded Nobel in Economics
Economist's View — ... Based on numerous studies of user-managed fish stocks, pastures, woods, lakes, and groundwater basins, Ostrom concludes that the outcomes are, more often than not, better than predicted by standard theories.” Mr. Williamson’s research, the committee said, found that “when market competition is limited, firms are better suited for conflict resolution than markets.” ... See also: Paul Krugman, Marginal Revolution 1, Marginal Revolution 2, Arnold Kling, Real Time Economics, Justin ...

Set the Over/Under at the Comma
Capital Gains and Games — ... called "Markets Aren't Everything."  Given her training in political science, Ostrom's work is less well known among economists.  Here is a nice post at Marginal Revolution and here (h/t Will Wilkinson) is an ...

Lin Ostrom --- Political Economist --- Wins 2009 Nobel
The Austrian Economists — ... democracy, but avoids the pitfalls of democracies?  Think about that --- pretty radical stuff actually when you dig into it. Alas, I actually didn't put a high probability on her winning, though I was of the conviction that she should --- I should have bet, the odds were something like 50/1, perhaps I could be as generous as her (she is giving a portion of the prize money to support research and graduate education). Many blog posts already up, especially Alex's at Marginal Revolution, are fantastic in summary.  Other announcements are wrong, but ...

links for 2009-10-13
J. Bradford DeLong's Grasping Reality with All Eight Tentacles — ... Harry McCracken: Windows Vista: A Review Recap Alex Tabarrok: Elinor Ostrom and the well-governed commons Elinor Ostrom's work culminated in Governing the ...