Gary Becker

• 1. Introduction

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  Gary Stanley Becker was born on the 2nd of December 1930 in Pottsville, Pennsylvania, and by the time he died in Chicago on the 3rd of May 2014, he had done something that few economists ever manage: he had changed the questions his field was willing to ask. Economist Justin Wolfers called him "the most important social scientist in the past 50 years." Milton Friedman, himself one of the most celebrated economists of the twentieth century, went further, calling Becker "the greatest social scientist who has lived and worked" in the second half of that century. Those are extraordinary claims. What did Gary Becker actually do to earn them? He did something that seemed almost reckless at the time: he walked out of economics and into territories that sociologists had assumed were theirs. Crime. Marriage. Racial discrimination. The family. Addiction. He insisted that ordinary economic logic, the idea that people weigh costs and benefits, applied everywhere. Not just to markets, but to life.

• 2. The Making of an Economist

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  At Princeton University, where Becker completed his undergraduate degree in 1951, his senior thesis carried a title that sounded safely conventional: "The Theory of Multi-Country Trade". Nothing in it predicted that he would spend his career studying divorce or organ markets. The turning point came at the University of Chicago, where he went on to earn his PhD in 1955. His dissertation, titled The Economics of Discrimination, was already a provocation. Becker later said that Milton Friedman's course on microeconomics had helped renew his interest in economics at a moment when he had been drifting away from the field. He called Friedman "by far the greatest living teacher I have ever had." Several other figures at Chicago shaped his thinking: Gregg Lewis, T. W. Schultz, Aaron Director, and L. J. Savage. Schultz in particular was already working on what would become human capital theory, and Becker would carry that torch further than anyone.

• 3. The Price of Prejudice

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  Becker's PhD thesis on discrimination was not merely a moral argument. It was an economic one, and that distinction mattered enormously for how policymakers could engage with it. His core insight was that discrimination costs money. When an employer refuses to hire a minority worker out of bias, he forces himself to pay more to other workers to get the same job done. Becker recognized that employers, customers, and employees all sometimes do not want to work with minorities because they hold bias against them. But that preference is not free. A firm that discriminates against certain workers must pay a premium to the others who remain, while a firm willing to hire from a wider pool can offer lower wages and still attract productive labor. In competitive markets, this should put discriminating firms at a disadvantage. The argument did not say discrimination would vanish on its own, but it gave policymakers a new way to think about the structural costs of prejudice, not just to those discriminated against but to the economy as a whole.

• 4. Rational Crime

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  Jurist Richard Posner described Becker's work on crime as "a fount of economic writing on crime and its control." Becker's argument was characteristically direct: criminals, he said, are not irrational. They calculate. While Becker acknowledged that many people operate under strong moral and ethical constraints, he argued that those who do break the law typically do so because they rationally judge the benefits of their crime to outweigh the costs. Those costs hinge on three factors: the probability of being caught, the probability of conviction, and the severity of punishment, all measured against the person's current alternatives. From that framework came a striking policy conclusion. Raising a fine costs almost nothing compared to deploying more police or building more prisons. Therefore, the most efficient deterrent is to maximize the fine while minimizing the resources spent on surveillance. Whether one agrees with that prescription or not, it transformed how criminologists and policymakers thought about the economics of law enforcement.

• 5. Human Capital

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  In 1964, Becker published Human Capital, the book that would become a classic in economic research. His argument was both simple and far-reaching. People, he contended, gain economic value when they invest in things like schooling, training, and health, in the same way that companies invest in machines or technology. He considered labor economics to be a branch of capital theory rather than a separate discipline. The book was republished in 1975 and again in 1993, a sign of its staying power. Becker's theory helped explain why workers with more education typically earn higher wages and why countries benefit from investing in learning and skill development. His framework also shaped later research on how people choose to improve their own capabilities and how governments can design workforce programs. Critics noted that human capital theory does not fully account for social and structural barriers, but the theory's influence on research into education, labor markets, and income inequality has remained substantial. Becker himself mused that "economists and plan-makers have fully agreed with the concept of investing on human beings."

• 6. The Economics of the Family

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  During the 1970s, Becker's attention shifted toward family life, a domain that most economists had left entirely to sociologists. Together with Jacob Mincer, he had already helped found Modern Household Economics, sometimes called the New Home Economics, in the 1960s at the labor workshop at Columbia University that both men directed. Among the first publications in that tradition were Becker's own 1960 paper on fertility and his 1965 paper on the allocation of time. Students who passed through the Becker-Mincer workshop at Columbia during the 1960s included Andrea Beller, Barry Chiswick, Victor Fuchs, Michael Grossman, Robert Michael, Sol Polachek, and Robert Willis. James Heckman, who would later win his own Nobel Prize, attended the same Columbia workshop from 1969 until moving to Chicago. The decade of focused family research produced A Treatise on the Family, published in 1981, with an expanded edition following in 1991. Becker applied the standard tools of economics, maximizing behavior, stable preferences, and equilibrium, to questions of marriage, divorce, family size, parental investment in children, and the transmission of wealth across generations. Shoshana Grossbard, who had been a student of Becker's at Chicago, published the first history of this New Home Economics tradition in 2001, later revising it after receiving feedback from the NHE founders themselves.

• 7. The Rotten Kid and the Organ Market

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  At the center of Becker's family theory sat what he called the "rotten kid theorem." Built on figures for United States families in 1981, it applied the economics of altruism to household dynamics. Becker argued that even a perfectly selfish child in a family with an altruistic parent will, under certain conditions, act in ways that serve the family's collective welfare, because doing otherwise would reduce the transfers the parent makes. The theorem held that a parent might forego higher income to focus on family commitments in order to maximize a well-meaning objective. Attempts to test the theorem empirically produced mixed results: cross-generational families did not necessarily maximize their joint income in practice. Becker's willingness to push economic logic into uncomfortable places was perhaps most visible in a 2007 article he co-wrote with Julio Jorge Elias, "Introducing Incentives in the market for live and cadaveric organ donations." Using economic modeling, they estimated that a free market for kidneys might price them at around US$15,000 and livers at around US$32,000. Critics argued that such a market would exploit donors from the developing world, raising questions the model alone could not resolve.

• 8. Legacy and Later Life

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  A political conservative, Becker wrote a monthly column for Business Week from 1985 to 2004, alternating with liberal Princeton economist Alan Blinder. In 1996 he served as a senior adviser to Republican presidential candidate Robert Dole. In December 2004, he launched a joint weblog with Judge Richard Posner, The Becker-Posner Blog, which became a notable forum for policy debate. He received the Presidential Medal of Freedom in 2007, having already collected the John Bates Clark Medal in 1967, the National Medal of Science in 2000, and the Nobel Prize in 1992, awarded "for having extended the domain of microeconomic analysis to a wide range of human behavior and interaction, including nonmarket behavior." By the time of a 2011 survey of economics professors, Becker was named their favorite living economist over the age of 60, ahead of Kenneth Arrow and Robert Solow. His work accumulated more than 200,000 citations on Google Scholar. Becker died in Chicago in 2014, at the age of 83, from surgical complications, and the same year the University of Chicago organized a three-day conference in his honor. His first wife, Doria Slote, had died in 1970 after sixteen years of marriage; around 1980, he married Guity Nashat, an Iranian historian of the Middle East whose research interests, she and Becker both noted, overlapped his own.