Gary Becker was an American economist born in 1930. Becker became famous for approaching the economy from a sociological perspective, analyzing elements such as the family, racial discrimination, crime and human capital.
Unlike traditional economists, Becker believed that the economy was not a matter of cold numbers handled by great economists. Becker defended the economy as a tool to respond to human problems.
The way in which he approached the study of social problems made him a pioneer, as he used sociology to explain economics.
Although he began studying at Princeton University, he ended up receiving a doctorate in Economics from the University of Chicago in 1955. An economist and university professor, he stands out for his works The Economy of Discrimination, Human Capital and The Treatise on the Family.
In 1992 he was awarded the prestigious Nobel Prize in Economics for his work on the relationship between human behavior and economics.
Economy and discrimination for Gary Becker
One of the most prominent fields of Becker’s work is the analysis of discrimination. Becker argued that due to discrimination, distortions were produced that altered the functioning of the market. Thus, faced with the distortions caused by discrimination, Becker advocated competition.
Another element that would also contribute to reducing discrimination was greater investment in educational spending. And it is that, his sociological analyzes confirmed that where spending on education was lower, discrimination was more accentuated.
Becker considered discrimination not only an evil for society, but also for the economy. Where there is discrimination against a minority, the cost of transactions will be higher.
Similarly, Becker stated that companies were capable of putting aside discrimination, being able to pay their employees equally regardless of their race or sex. In this sense, Becker argued that all workers, beyond their identity characteristics, could reach similar levels of productivity.
Relationship between the economy and crime
Becker is also known for his study on the economics of crime. Thus, Becker began his work by conducting an analysis of the benefits and costs of parking a car in a restricted but well-located area. Interestingly, this study led him to conclude that it was preferable to park in a restricted area and, therefore, commit an illegal act.
Thanks to this particular case, Becker was able to extrapolate his investigations to the world of crime, addressing issues such as fines and the costs of maintaining security and law enforcement.
Another analysis carried out by Gary Becker was the case of robberies in supermarkets. It turned out that retail outlets such as supermarkets operated on razor-thin margins, making it worthwhile for them to bear the losses from thefts rather than spend on security that would far outweigh the losses from thefts.
Organ market according to Gary Becker
One of the great social problems has been the shortage of organs for transplantation. In this regard, Becker stated that a free market for organs could be the solution to this issue.
Thanks to this study, he was able to calculate the price that organs could reach in a hypothetical free market. But he also concluded that the existence of a market for organs for transplantation could dangerously explode in less developed countries.
Human capital and families
Becker was an economist characterized by considering human capital a determining factor in the economy. In fact, he argued that investment in improving human capital translates into great progress at the social level. In addition, he pointed to punctuality as a synonym for efficiency.
On the contrary, according to Becker, there are circumstances that negatively influence productivity, as in the case of alcoholism.
Within his social analysis of the economy, he studied the impact of fertility, social security, and marriages. On the other hand, he also took into account the distribution of family time in the economy. A clear example is the opportunity costs of raising children.
As far as marriage is concerned, he assessed the influence of the spouses’ salaries and salary differences in the home.