Two Americans Capture Top Nobel Economics Prize

Two Americans, Elinor Ostrom and Oliver Williamson, share this year's Nobel Prize in Economics.

The last award in this year's Nobel series, the Economics Prize, has been awarded to Elinor Ostrom from Indiana University and to Oliver Williamson from the University of California at Berkeley.

The two won for their analysis of how authority is exercised in economic systems and in companies.

Nobel Economics Committee Chairman Bertil Holmlund said their work was enlightening.

"Elinor Ostrom's research has provided novel lessons about the mechanisms that sustain human cooperation," he said. "Oliver Williamson's research has offered new insights on how transaction costs determine the boundaries of the firm. Both laureates have profoundly enhanced our understanding of economic governance."

Williamson developed a theory where business firms can serve as structures to resolve conflicts.

Ostrom's research has focuses on the interaction of people and natural resources and how common property can be successfully managed by those groups using it.

In a phone call press conference in Stockholm, professor Ostrom was asked how she felt about becoming the first woman to win the Nobel Economics Prize since it was first awarded in 1968.

"I had not realized that that was the case until just recently when they called. My first reaction was great surprise and appreciation," said Ostrom. "There are many, many people who have struggled mightily and to be chosen for this prize is a great honor. And I am still a little bit in shock."

Ostrom was also asked about what her research might say about how we deal with the growing problem of global warming.

"A lot of people are now waiting for international negotiations to solve it," said Ostrom. "That again is the presumption that there are public officials who are genius and the rest of us are not. It is going to be important that there is an international agreement, but we can be taking steps at family level, community level, regional level, provincial, state, national and there are many steps that have already been taken that are not going to solve it themselves but cumulatively can make a big difference."

Ostrom and Williamson share the $1.4-million prize. They will also receive a gold medal and a diploma from the Swedish king on December 10, the anniversary of Alfred Nobel's death in 1896.