BECKER, GARY S.
(1930–)
Gary S. Becker received his Ph.D. in economics from the University of Chicago in 1955. He taught at Columbia University from 1957 to 1970, after which he returned to the University of Chicago. He was awarded the Nobel Prize for Economics in 1992. His numerous other distinctions include the Irene B. Tauber Award from the Population Association of America in 1997, in recognition of his many contributions to demography and population studies.
Beginning with his 1957 analysis of the economics of discrimination, Becker's work builds on the assumption that rational economic choice governs all spheres of human behavior. His approach of using standard economic models to analyze demographic behavior is demonstrated in his classic 1960 paper on the economics of fertility. Becker drew an analogy between decisions about childbearing and decisions about the purchase of consumer durables. Like consumer durables, Becker argued, children are long-term investments in which decisions about both quantity and quality play an important role. Becker observed that in the case of consumer durables such as automobiles or televisions, increases in income often led to greater increases in the quality of the good rather than in the number of units purchased. According to Becker, this quantity-quality tradeoff plays an important role in explaining why increasing income does not necessarily lead to higher fertility. This analysis of the quantity-quality tradeoff in fertility was further formalized and refined in later work by Becker and other economists, such as Robert Willis.
Becker's other important insight about the economics of fertility also helps explain why there is often a negative association between income and fertility. Building on his 1965 research on the economics of time allocation, Becker emphasized the fact that children are relatively time-intensive compared to other commodities, making children relatively more expensive to high-wage couples than to low-wage couples. This recognition of the relationship between the value of time and the cost of children has had a profound influence on understanding trends in fertility in both high-income and low-income countries.
In a similar use of standard economic tools in the modeling of demographic and social processes, Becker's work on the economics of marriage in 1973 and 1974 formalized the analogy between marriage markets and other markets in which two sides combine to form matches or partnerships. His analysis of assortative mating drew on a long tradition in mathematics and economics of assignment problems. Becker concluded from these models that there would be positive assortative mating in the marriage market when traits are complementary and negative assortative mating when traits are substitutes. Becker also developed models of the economics of divorce, noting that imperfect information and changes in characteristics may eventually cause the gains of marriage to fall below what was expected at the time of marriage.
Another of Becker's important contributions to research on families was his analysis of intra family resource allocation. Beginning with his influential paper on social interactions in 1974, he developed models exploring the importance of altruism in the family. One result was what he called the Rotten Kid Theorem, which argues that even a selfish child will act to maximize overall family well-being, since this will cause the household head (assumed to be an altruist) to increase the child's consumption. This has broad and often surprising implications for government policy. For example, the Rotten Kid Theorem implies that a government program designed to increase food consumption of school children may have little effect, since household heads may simply reduce their own transfers to children to offset the government grant, effectively neutralizing the program. As with many of Becker's results, the Rotten Kid Theorem holds in its strictest form only under particular assumptions. In 1989, economist Theodore Bergstrom provided a useful analysis of the conditions under which the Rotten Kid Theorem does and does not apply. Becker's model of the family has also been criticized from a feminist perspective, for example, by Nancy Folbre in 1997.
Building on his work on quality-quantity tradeoffs, intra-family allocations, and human capital, Becker has made important contributions to research on intergenerational transmission of inequality. A series of papers coauthored with Nigel Tomes developed models exploring issues such as how assortative mating and quality-quantity tradeoffs in fertility affect the distribution of income in a society. Becker subsequently expanded this work into models exploring the role that fertility and child investments play in the long-term dynamics of economic growth.
Becker provides a convenient overview of his approach to economics in his 1993 Nobel Prize lecture. A more comprehensive summary of his contributions to the economics of fertility, marriage, and the family is provided in his book A Treatise on the Family (1991).
BIBLIOGRAPHY
SELECTED WORKS BY GARY S. BECKER.
Becker, Gary S. 1957. The Economics of Discrimination. Chicago: University of Chicago Press.
——. 1960. "An Economic Analysis of Fertility." In Demographic and Economic Change in Developed Countries. Princeton, NJ: National Bureau of Economic Research.
——. 1964. Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education. New York: Columbia University Press.
——. 1965. "A Theory of the Allocation of Time." Economic Journal 75(299): 493–517.
——. 1973–1974a. "A Theory of Marriage," pts I and II. Journal of Political Economy 81(4): 813–846; 82(2): S11–S26.
——. 1974b. "A Theory of Social Interactions." Journal of Political Economy 82(6): 1,063–1,093.
——. 1991. A Treatise on the Family, enlarged edition. Cambridge, MA: Harvard University Press.
——. 1993. "Nobel Lecture: The Economic Way of Looking at Behavior." Journal of Political Economy 101(3): 385–409.
Becker, Gary S., and Robert J. Barro. 1988. "A Reformulation of the Economic Theory of Fertility." Quarterly Journal of Economics 103(1): 1–25.
Becker, Gary S., Edward L. Glaeser, and Kevin M. Murphy. 1999. "Population and Economic Growth." American Economic Review 89(2):145–149.
Becker, Gary S., Elisabeth M. Landes, and Robert T. Michael. 1977. "An Economic Analysis of Marital Instability." Journal of Political Economy 85(6): 1,141–1,188.
Becker, Gary S., and H. Gregg Lewis. 1973. "On the Interaction between the Quantity and Quality of Children." Journal of Political Economy 81(2), Part II: S279–S288.
Becker, Gary S., Kevin M. Murphy, and Robert Tamura. 1990. "Human Capital, Fertility, and Economic Growth." Journal of Political Economy 98(5), Part II: S12–S37.
Becker, Gary S., and Nigel Tomes. 1979, "An Equilibrium Theory of the Distribution of Income and Intergenerational Mobility." Journal of Political Economy 87(6): 1,153–1,189.
SELECTED WORKS ABOUT GARY S. BECKER.
Bergstrom, Theodore. 1989. "A Fresh Look at the Rotten Kid Theorem and Other Household Mysteries." Journal of Political Economy 97(5):1,138–1,159.
Folbre, Nancy. 1997. "The Future of the Elephant-Bird." Population and Development Review 23(3): 647–654.
Willis, Robert. 1973. "A New Approach to the Economic Theory of Fertility Behavior." Journal of Political Economy March–April: S14–S64.
