Boettke on the New Laureates

While I remain disappointed that the Nobel Prize in Economic Science has yet to be awarded to Gordon Tullock, Armen Alchian, Harold Demsetz, and Jagdish Bhagwati, after reading this essay (from today’s Wall Street Journal) by my GMU colleague Pete Boettke I’m more impressed with yesterday’s award than I was when I first heard it.

Here are the opening paragraphs:

Yesterday Leonid Hurwicz, Eric Maskin and Roger
Myerson won the Nobel Prize in Economic Science for their pioneering
work in the field of "mechanism design." Strangely, some have used this
occasion to disparage free-market economics. But the truth is the
deserving recipients owe a direct debt to free-market thinkers who came
before them.

Mechanism design is an area of economic research that
focuses on how institutional structures can be manipulated by changing
the rules of the game in order to produce socially optimal results. The
best intentions for the public good will go astray if the institutional
arrangements are not consistent with the self-interest of decision
makers.

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