“He just pushed economics in so many different directions,” said Murphy, who collaborated with Becker on research. “He believed that economics was helpful to understanding and improving people’s lives and that’s how he did his research and that’s how he taught.”
This was how Becker saw his own work: “My work on human capital began with an effort to calculate both private and social rates of return to men, women, blacks, and other groups from investments in different levels of education.”
He was a man whose vision was way ahead of its time. Becker applied economics to mankind and human behavior in a way not many ever thought possible.
He held that people act rationally and in a calculated way, balancing wide-ranging incentives and employing cost-benefit assessments rather than just in a quest of personal gain.
Not many saw the sense in his theories but that didn’t stop him.
“For a long time my type of work was either ignored or strongly disliked by most of the leading economists,”Becker wrote. “I was considered way out and perhaps not really an economist. But younger economists were more sympathetic. They may disagree with my analysis but accept the kind of problems studied as perfectly legitimate.”
Here are some uncanny observations:
The Household Industry
He saw households as small factories producing goods such as meals, shelter and entertainment. He talked about the division of labor in households and altruism and selfishness within families and how welfare payments to unmarried mothers in the U.S. discouraged weddings and encouraged fertility among poorer women.
His "rotten kid theorem" was eerily apt. According to it, parents should delay gifts of money or expensive trinkets and gadgets to their siblings as long as possible ... preferably until after they're as dead as a doornail. And it suggests that money should be willed out according to needs.
Government and Governing
“What I have always learned to be the Chicago view, and taught to be the Chicago view, is that free markets do a good job,”he said.“They are not perfect, but governments do a worse job.”
Becker held the Republican Party had created a “crisis in conservatism” by focusing increasingly on social and military issues.
“I believe that the best way to restore the consistency and attractiveness of the conservative movement,” he wrote, “is for modern conservatism to return to its roots of skepticism toward governmental actions,” i.e. “more flexible approaches toward hot-button issues like gays in the military, gay marriage, abortions, stem-cell research.”
Another one his theories related to governmentswas way out of the ordinary, “Government should do much less so they can concentrate on and do better with the tasks they are most needed for, such as police and military, infrastructure, safety nets, and regulation of activities with big externalities. Regrettably, I am not optimistic that much can be achieved quickly in slimming down governments, given the strong self-interests and special interests that benefit from the present situation.”
Criminals, Culprits and Punishment:
In a time when everyone thought crime was a result of mental illness or social oppression, he rationalized criminal behavior and talked about how the culprits might balance the benefits of a successful heist against the risk of capture and punishment.
In his opinion the way to decrease crime was to raise the risks by increasing either surveillance or the punishment.
Becker's theory suggested ’lopping off heads at the first offense’ would solve the issue but also realized people generally would not affirm to that mode of crime control. He believed getting rid of crime would not cost an arm and a leg but that an entirely crime-free society would be worse off than one that simply tried to minimize it. Would you want to live in a police state, he wondered.
He believed, “Fines are preferable to imprisonment and other types of punishment because they are more efficient. With a fine, the punishment to offenders is also revenue to the State.”
If only there were more people listening to him.