Academy of Achievement Logo

Gary Becker

Interview: Gary Becker
Nobel Prize in Economics

May 5, 2001
San Antonio, Texas

Back to Gary Becker Interview

Professor Becker, your first book grew out of work you did while you were still in graduate school at the University of Chicago. This was your book on the economics of discrimination, which was such a radical idea at the time. How did this come about?

Gary Becker: Early on, maybe my second or third year, I got a little idea that I thought I could use to understand this social problem of discrimination against groups. In particular blacks, but also women and other groups -- Jews, Chinese in many societies, and so on. So I had this little idea, how I could use economic theory to talk about the connection between people's prejudices and how that worked out in the economic system. So let's say if an employer was prejudiced against black workers, what did that mean for the jobs that black workers could get and for the earnings that they would make compared to, say whites, who were equally skilled? Now it's not so obvious that even though, let's say employers will be prejudiced, how that shows up in terms of earnings and occupation. That linkage had not been discussed, in fact you'll find almost no literature on discrimination, prior to my book, by economists. So I had this little idea. I saw a way of taking the prejudices of workers and employers and customers and all groups, even governments, and sort of putting that through an economic analysis with competition and the goals of employers, opportunities for black and white employees to choose among different firms. So it becomes a complicated problem, using all the tools of economics. I saw a way to do that and be able to say, "Well, if there's much prejudice under this-this conditions, there'll be this much difference in wages between equally productive whites and blacks, this much unemployment of blacks, this much lower occupations of blacks." So that really excited me, because it seemed to be obviously important if we were trying to understand the situation of blacks, you just can't look at... we can't see the prejudices, it's manifested in what we see in terms of earnings and employment. I had something that could be manifested and yet I had a way of working back and sort of inferring what the prejudices must have been. So I thought that was really exciting.

Most of my teachers at Chicago were open to my working on that. Some were skeptical that an economist should be working on these problems, so they forced a sociologist to be a member of my thesis committee. But I had enough of my faculty like (Milton) Friedman and others -- Ted Schultz, who eventually won the Nobel Prize also -- and some others there, who thought I was onto something, who encouraged me. So I kept doing it. My fellow graduate students were skeptical, and I'd go out to other economists, at MIT and elsewhere, very good places, they were very skeptical if this was economics. I don't know if I would have persisted if it wasn't -- I had some support among my faculty members who I admired so much. And given my own, you might say, rebellious instincts, the combination, I think both were necessary in enabling me to persist in the face of the fact that most economists thought this wasn't really economics, and this was sociology or whatever you wanted to call it. But I thought it was economics, in the sense I was using economic tools to discuss what was obviously, I would say, "This is a major problem. We economists should be talking about this," and they would be skeptical about that.

Once it came out, it seems like it sort of sat there for a while. It was so innovative that people didn't take it seriously at first.

Gary Becker: I would say for ten years, it had almost no impact on anything that was done, was not discussed very much. Sat there. I mean, it got a couple of reviews that were favorable, and some were really extremely favorable, but they didn't have much impact either. And then, all of a sudden, maybe because of civil rights legislation, the Civil Rights Movement, these issues came to the fore. People were discussing these issues. And even economists began to see, "Well, this is an important issue." And then they discovered, "Well, Becker has this book out there on this subject that we haven't paid any attention to." So gradually, along with the subject, it became something economists discussed. And that just snowballed, and now my -- whatever you want to call it, discrimination economics, minority economics -- it's a tremendous, a very big field in economics, and a huge number of papers are written and books written about it every year. To my surprise, my book went into a second edition. It's still discussed a lot, still has a lot of references. So I find that very gratifying. It's almost 50 years since the book was published. I mean it was a thesis. I wrote that book when I was 23 years old basically. That this still, you know, is being discussed, and more importantly, that the field has expanded enormously. A lot of new work that's been done. But it took awhile. But once it caught on, when the subject caught on, then it really snowballed.

Gary Becker Interview Photo
During the years when your work went unrecognized, wasn't it kind of disenchanting or disillusioning for you?

Gary Becker: Well it was, but I was working on other things I was also excited about. I was confident. I had a certain quiet confidence. I didn't like it that it was ignored of course. I can't say I was a masochist in that regard. I didn't like it. I can say acclaim and recognition was something I didn't seek, but of course I did want that. But I felt I had to take the long run. I thought I'd done something valuable and that ultimately it would catch on. That was my belief. I didn't know, but I felt that ultimately it would catch on. Plus the fact that I was working on other things. I had a good position at Columbia University. I just thought, "I have to keep at it, and let's hope that it will catch on." But of course it was a bit discouraging.

So what was the next focus of your work, after your study of discrimination?

Gary Becker: What we call human capital, that is, investments in people's education and training. I started working on that as soon as I came to Columbia in 1957. A small project, estimating how much, say, earnings that people could get from improving their education, by going to college rather than high school, for example. How much more they earned, what happened to their occupations, their unemployment, all the aspects of their economic situation. And starting doing that, I saw this was a much bigger problem than I had anticipated, and a much more challenging issue to look at more generally, the issue of investments in people, in knowledge, and in skills and in training. So I sat down to try to look at that in a very general way, both theoretically and then to also make these variety of calculations for the United States and a little bit for other countries. And I wrote a book called Human Capital that was published in 1964 on that subject. And some people will say that's the most important book I've written. I don't know if that's true. It certainly, maybe in some sense, has been the most influential thing I've done.

The world has changed in the 30 years since that book was written. Is it still pertinent today?

Gary Becker: It's probably become even more pertinent, because...

Modern economic life is based a lot on knowledge and information. I mean that's the foundation, it's not based on strength. Traditional economies you have more strength, or simple machinery in a traditional agricultural economy. But that's not what the American economy is about. You can't get very far by strength, otherwise people like me would be well down on the totem pole. So it's what you can command, the information and the skills that you command that determines it. And this is not just the United States, this is globally. As economies experience economic development, there's a movement toward making human capital the focus of their economies. And so "investment in people" becomes a re-orientation and part of economics now, once you recognize the significance of human capital. Economies and individuals are oriented around the investment in themselves or in the populations. And economies that tend to neglect their people, they tend to do badly. And economies that help promote the human capital of their population -- not only their rich population, but the people coming from poorer backgrounds -- those are the economies as you look around that have become more successful. So I think the so-called human capital revolution has been a revolution in part because it's more relevant to the modern economies then it was, say, the more primitive economies. So I think the influence of this concept, people working in this area, has grown exponentially for those reasons, I think.

What do you think of the "welfare to work" concept? Some of those programs involve investment in people.

Gary Becker: A lot of government policies now, they talk, they discuss them -- and this is bipartisan, it doesn't matter whether you're Democrats or Republicans -- when they're trying to justify a policy affecting people, they say this is an investment in human capital. Sometimes, even in my judgment, they go too far. It's just a transfer to people. But the "welfare to work" and a bunch of the other ones, are attempts to, in part, get people with the skills, so that they can hold decent jobs, and the notion is they bring in their own earnings rather then getting support from the government. And more than that, they bring in more self-respect and so on. So this transcends simply the materialistic side, I think. Human capital transcends the material side. The material side is important, but also other components of living become part of human capital, including self-respect, self-reliance, pride in what you're achieving, are all part of human capital as we see it. And I think one of the main justifications for reform in a welfare program, why it was bipartisan -- supported by President Clinton and by the Republicans in Congress and outside -- was that it was a way of trying to bring more human capital to families that I think had been neglected from -- in a more fundamental way -- neglected in the sense of not trying to give them the capabilities so that they would be able to stand on their own feet. And I think that was an important reform that's now being emulated in other countries of the world.

We've had some increases in the minimum wage, but in a big city -- Los Angeles for instance -- because of the cost of housing, it's almost impossible to support a family, even in a small apartment, on a minimum wage. Even with the "welfare to work" programs, a living wage is out of reach for many people. In your view, how can we deal with that issue?

Gary Becker: Well there's the short run and the long run.

Long run, I think, the goal -- and I think it's a feasible goal -- would be to increase the skills of people at the lower end enough so they're not just at the minimum wage. Minimum wage is a low wage, six dollars an hour or so. You multiply that times 2000 hours a year, you're getting $12,000. That's a low wage for Los Angeles or any other expensive part of the United States. So the challenge is to increase their capabilities and skills so that they can earn a lot more than that. That's why the human capital focus puts a lot of emphasis on education, reforming education, improving education, increasing the access of education to people from modest backgrounds. Most kids who come from middle classes or rich families, they'll go to college, that's almost automatically expected with a few exceptions. But it's the kids from the lower end that we have to worry about, and who worry that they have good schooling, K to 12, and then those who are interested and capable will go on to some form of higher education. And if they do that, they'll get well above the minimum wage. Minimum wage now, it's a few percent only of the U.S. population. It's partly teenagers who are not yet finished with their career, partly people that don't have the skills. And the teenagers, well they'll eventually evolve into people above the minimum wage. They're not so much the problem. It's the people who will not get the education that gives them the capabilities to be earning a lot more than the minimum. That is where social policy, economic policy should be focused. And we can certainly achieve that goal. It's a question of concentrating the resources in the right way to do it. And if we do it, we'll have very few families, as opposed to teenagers who are at those low wage levels. That's what we advocate, what I advocate, and it comes directly out of my research in this area.

Gary Becker Interview Photo
You later turned your attention professionally to the issues of family. How did you think of applying economic theory to issues of divorce and family?

Gary Becker: My work on human capital got into issues of why different children have different opportunities. Some go on to college, some don't. Some drop out very early, some continue on, some are successful, some aren't. It seemed pretty clear to everybody who's thought about the problem, that it's something in the family that makes a difference. So I began to think about it more. I've taken it as given that these children are making these decisions, but I really want to trace it back some steps deeper, into what family they're in, and family choices.

I began to think more sporadically about family: Who marries whom, what matches you see, how many children people had -- an area I had touched on in a paper I did much earlier, but came back to that. How much they invest in their child, that is, effort and time, money, encouragement they put into the child. That directly looks at the educational issue. But then divorce was beginning to increase. Do families stay together? I had to talk about the divorce issue. Eventually I published this book that covered almost every aspect, in terms of broad issues, that the family deals with, from having children, from marrying before having children, to investing in your children, to divorcing, to care of elderly parents. All these issues I tried to bring together within a common framework. And it was the hardest thing I ever did, I mean mentally. It took enormous concentration. For a number of years I'd wake up at night, start working on it. I was very tired when the book was over. It took a year or two before I could really get much intellectual zest back to work on things. It took a lot out of me doing that book, and I felt it was an imperfect book. Family is such a huge subject that I certainly didn't feel I "solved" the family. But at the same time, I felt I had made progress in showing that one could use these tools to help illuminate some issues of the family, and was very satisfied about that, even though, again, when the book came out, the economists, the non-economists were skeptical. Even the Nobel Prize Committee, when they awarded me the Nobel Prize, they mentioned my work on discrimination very positively, my work on crime, which we haven't talked about. My work on human capital, those were all positive. But even they had to say that the family is still very controversial, this work on the family.

What was so controversial about it?

Gary Becker: Let me make that clear, 'cause this is important.

I didn't mean that families only worried -- when people married -- how much money they could get out of the marriage. I mean, if I did that, then sure, money is important, but there are a lot of other things in marriage: affection, love, what have you. And so I tried to take account of all those type of variables, but do it in a way where I used economic tools of analysis. And by the tools of analysis, I meant that people were looking out for their interests, however broadly we define these interests. It could include, of course, altruism and concern for others and charity. But they were looking out for their interest, and they made decisions that made sort of comparisons between the benefits and the costs of their interests, however defined, and they choose the ones that maximize their well-being. That was the approach. Now, when suitably sort of qualified, the way I did it now, it doesn't seem like such an extreme approach, but for many people, that seemed antithetical to how they wanted to look at families, as sort of driven by emotion, driven by love, non-calculating. That's what I was going against, that type of consideration, and that's where the controversy came from. Are these important in marital decisions or divorce decisions or family-size decisions? That defined the controversy. I claimed they were. I tried to claim it not only theoretically, but by doing empirical statistical analysis, quantitative analysis, that demonstrated it was. Others felt I was just... some of them were angry, others just thought I was doing a -- more calmly -- I was off on the wrong direction, that this wasn't going to help with the family. That was the source of the controversy.

What effect has the liberation of women had on the family? Women have gained a measure of equality in the workplace, pursuing professional careers in areas where they weren't before. Many more women are able to support themselves now. What effect has that had? It certainly is an economic issue.

Gary Becker: Absolutely. A Very big effect.

I have a chapter in The Treatise on the Family called, "The Division of Labor Between Husbands and Wives," where I go into it. Another controversial chapter. I go into that a lot. I've tracked a lot, in my work, the growing employment of married women, the consequences of which I discuss in the book -- in my work -- for family size. No question it has been one of the important factors reducing family size. When they're at work, and she doesn't want to take the time, or doesn't have the time, or time is too valuable to be having four, five children, the way families even as late as the turn of the century in the United States had. So they're going to have one or two, much smaller size. It's going to affect their propensities to divorce. If a woman has a good job and her marriage isn't that great, in the past, well, she was scared about getting divorced. Who was going to take care of her and so on? And of course marriage often brings -- divorce brings these doubts today. But now a woman who has a job can say," Well yes, I don't know if I'm going to get support and so on, but at least I can go out and earn some income. I'm not completely dependent," and I think that's been an important factor.

Do you think women's increasing economic freedom has heightened the divorce rate?

Gary Becker: There's no question it's heightened the divorce rate. That's well documented. It's heightened the divorce rate, it's cut fertility down. It's affected the relation between husband and wife within a marriage. These are all things that I think are very well documented and this approach can help with. I discuss a bunch of these problems. Before I leave that subject, I should stress that doesn't mean everything is hunky-dunky between me and a lot of feminists in this area. On the one hand, my book is discussed a lot by the feminists, sometimes positively, but sometimes, some parts of it negatively.

I stress that there are reasons why we've had this gender division of labor between market and household. That while women will work more in the market, that I can understand and show why. Yet it's not simply brainwashing that has led women to be doing more of the housework, that there are reasons why that's the case. And that we'll modify that, we're going to eliminate that entirely. That was my argument, and I discuss that in fair detail. And that has been very unpopular with -- not every woman. My wife calls herself a feminist, and she thinks I'm right on, and she teaches about women in the Middle East. But a lot of others think that's not right, that all this is a result of social policy and that I've gone too far in thinking there's something else working there. So that's been a source of some contention between me and -- particularly -- some women who are economists, who are feminists.

Is it a truism that after divorce these financially independent women find themselves less economically comfortable than while they were married?

Gary Becker: Generally, they're much worse off. There's no question about that. That's well documented. And I think it has something to do with "no fault" divorce. I have a discussion of that in my book, and in this case, a lot of women and men who originally thought I was wrong about that have come around to that position.

There's no question that divorced women have, on the whole, financially suffered. They may feel, "Well, nevertheless it's still a good decision." They weren't happy and all that, that's fine. But financially, they have suffered, and it should be obvious that they lose one source of income. They get some child support, but often that's inadequate or it's not even paid. Particularly lower income women just don't get the child support, I mean a lot of violation of contract by the man on that. So many women are in rather poor circumstances after the divorce. If we didn't have "no fault," if their agreement had to be initially achieved in order to get the divorce, I think they would be in a stronger bargaining position and therefore could bargain for a better financial position. So that's been my argument, but the facts are clear, that they're worse off on the whole.

Gary Becker Interview Photo
Another major area of your work has been the economics of crime and punishment. Could you tell us how you came to work in that area?

Gary Becker: We just had a symposium out at the University of Chicago. I got some award at the university and a good economist, Levitt, was speaking about crime, and he had a statistic. He said, "Becker wrote his paper in 1968, and how much work by economists was there prior to 1968 on crime?" The answer was zero. Now how did I get interested in it? Well again, it seemed to me a natural application of, of the type of thinking I was doing. If we have a minute, I can tell a kind of amusing story.

I was rushing down to Columbia, driving down to give an oral exam to a Ph.D. student. I had to park, and I had to decide whether to park illegally on the street around the Columbia neighborhood, or put it in a parking lot which was further away and of course cost some money. And I said, "Well, what's the chance I'll get a ticket?" And I made a calculation in my head and I left it on the street. And as I walked over to the exam, I said, "But if I'm going through that calculation, then the police must also be deciding how often they should inspect in order to determine what's the right thing for them to do, which is costly." So I asked the poor student to solve that problem when I came in, and he or she -- I don't remember whether it was a man or a woman -- she couldn't do it, not naturally. I was looking more at the thought processes and not whether they could do it, and they did fine. And then I kept thinking about it, that this was a good problem, because if we take the approach I used, that people decide on crime with similar sort of calculations as they decide on whether to become a professor, that's the starting point. There is no difference between criminals and professors in that sense. Of course, some people are honest, they don't want to be criminals. But the kind of calculation, "Can I do better by this?" as opposed to something else, is a calculation I think a lot of criminals make. And now we have to have enforcement. How much money do we want to put into enforcement? To capturing and convicting and punishing people? If we improve legal opportunities through education -- my human capital work came in -- then that should reduce crime. So I built a framework to discuss those issues, where improving education will reduce crime, improving the likelihood that we will apprehend and convict criminals would reduce crime, and then I went back and looked how criminals will respond to this and came to a bunch of conclusions about how much we should put into one activity, another activity. I did some preliminary tests on this with actual data, whether the criminals actually respond to punishment, whether improvements in education reduce crime. I had a series of students who followed that up. So this is the way the area developed. It's now a very big area in economics, some very good work being done, some by my students, some by a lot of other people. But my orientation was this little sort of experience I had going to this exam, and then building on my type of work at that time.

It came from your own experiences as a criminal?

Gary Becker: As a criminal. It turned out I was a criminal, no question. Misdemeanor I would say, but it was an illegal action. The bottom line is I didn't get a ticket. At that time I got away with it. But absolutely right.

Obviously crime is still a big issue in this country. The figures seem to go up and down for violent crime. As you see it, how can we improve the situation?

Gary Becker Interview Photo
Gary Becker: Crime is a worldwide issue now, that's one thing. Probably, crime is as high in some European countries as it is in the United States. It's turned out to be a worldwide issue, so I get a lot of interest from people elsewhere. The U.S. has actually had a big improvement since 1980. There's no question about that. Crime rates have gone down substantially in most parts of the United States. But that's in response to an even larger increase from 1960 to 1980, so we're still above the crime rates of, let's say, 40 years ago here. There are two different ways you can approach it, both have to be used. I think the emphasis in my study is generally the right emphasis. You want to improve the legal jobs that people who are likely to go into crime can get. The usual felony crimes are committed by people from poorer backgrounds and low income opportunities. If you want to make the cost to them of going into crime greater by making their opportunities better, we come back to education again and these other issues. So you see, all these things are interrelated. The second side of it is the punishment side.

I think, the major reason we've reduced crimes since 1980 is that educational returns have improved, and that we're apprehending many more criminals than we did before, and punishing them. I think we have to maintain that. One of the unfortunate side effects of that is we have almost two million men and women, mainly men, in prisons now in the United States, and that's really a sad commentary on our society. On the other hand, I think -- most people live in cities, I live on the South Side of Chicago, which was a very high crime area, now is a somewhat lower crime area, but still pretty high. Most of us who live in cities really have found the decline in crime in the last 20 years are a tremendous boom to living there. You don't have to worry quite as much as you did before, every time you went even to a supermarket parking lot, or certainly out of your home at night. And I walk home from -- I have some seminars in the evening -- I walk home at 10 o'clock at night. I'm much less worried now than I was before. I can't say I'm completely unconcerned now, but I'm certainly much less worried. I think it's been a great boom for the American of all colors, all backgrounds, especially for poorer people. People who, like we do, live either in or surrounded by a poor neighborhood. I think we've got to do more, and I think education is one way, and to do more, and to give still a firmer message that people who commit serious crimes -- I'm not talking about minor crimes, I'm not even talking about drug use -- but I'm talking about serious crimes, violent crimes, robberies and the like. They will be very likely -- if they decided to take that route, to give up what I hope is a good job that they could be getting -- that they will be punished. But you know, the better way is to make sure the job structure's strong so that people who have the skills and capacities will take that route, they won't take the route of crime. And we've been doing that. We just have to do more of that, and I think more on the other end. So it's a carrot and the stick as I like to put it. I don't think you can do it with a carrot alone and you certainly can't do it with a stick alone. You've got to use both methods.

What are your thoughts on the economics of the illegal drug trade in this country?

Gary Becker: I've been interested in the drug problem. I believe we're too harsh on simple users of drugs in terms of the punishments we're giving to them. If we want drugs to be illegal, then we have to punish the distributors, but not people who have a small amount of crack or whatever they have and we send them to two or three years in prison. That seems to me absurd, and it's well out of proportion to the seriousness of what they're doing. The harder issue is, do we want to go in the direction of legalizing some drugs? I've been a proponent of some legalization of some drugs. I would prefer people didn't feel the need to take drugs, but our policies that we've tried to adopt to stamp out drugs I think have caused more damage than successes. We have soldiers in Latin America, we have the police spending a lot of their time on drugs. We have a lot of corruption in the police because of the drug trade. We're punishing a lot of people whose only offense is that they're mild users of drugs. I think these costs are too great, and I believe ultimately we're going to decide, at least some experiments along the lines of legalizing some types of drugs, and I think that's the direction we should be taking.

We'd like to talk a little about your background, childhood, education and so forth. We know you grew up in New York, but you started out in a small town, didn't you?

Gary Becker: I come from a town called Pottsville, Pennsylvania, which was a bituminous coal mining town in those days. Still does some strip mining, though it's mainly a depressed area now. We lived there, my two sisters and my brother and I were all born there, so we lived there about ten years. My father was a small businessman who basically dealt with the miners, but he was not a miner himself. It goes back a long time, but it was a very pleasant little town. People knew each other and we had about 25,000 people in the town, mostly connected with the mine, but obviously not all of them. It was a time of depression in the town and the economy as a whole. This goes back to the '30s. So circumstances were not good for most people, including us, although we did a little better than the rest of them. Subsequently I've lived mainly in large cities, so that was a big contrast for me. I still have a lot of nostalgia for small towns, so in the summer we go to a small town and I enjoy the more intimacy that you find in a small town. You know people, you know your neighbors. You're on familiar relations with -- not only the shopkeeper -- but everybody around. And which, of course, you generally don't have in a big city. So I was happy, I mean it was good. I always felt I was lucky to have had both large city and small town upbringing.

Your father came to the U.S. from Montreal when he was still in his teens, didn't he? How did he come to strike out on his own at such an early age?

Gary Becker: My father's parents were immigrants to Montreal and my grandfather, my father's father, was not very successful. My father had a lot of ambition, and in a modern day he would have channeled that ambition into education and so on, and in fact his mother wanted him to be a lawyer. But my father, given that his father didn't do very well, he wanted to make money very quickly. But the opportunities, as he saw it, in Canada in those days, weren't as good as in the United States. So when he was 14 years old he left Canada, moved to the United States around the Niagara Falls area and opened his own business. And he was 15 years old and he actually had his own business. He had nobody around. It wasn't that his father was helping him, he was living by himself and managing a business. It was remarkable. You wouldn't think of doing it today, and he did it. And he regretted it. He regretted that he dropped out of school after eighth grade, and he regretted -- because he always had an interest in reading and so on -- that he didn't follow his mother's advice. But he was just too eager to get on his own, be financially independent and be more successful than his father had been. So that was why he left, and it was extremely difficult for him. He wore a derby hat to make himself look older, he was so young. So he was remarkable in a lot of ways, and wanted us to be more educated than he was, and as I said, regretted that his impetuousness -- although he turned out to be quite successful, what he did -- but he felt he would have preferred taking another path.

You said your father's parents were immigrants to Montreal. Where did they come from?

Gary Becker: Eastern Europe. I don't know exactly where, because my father I think was six years old when he left and he never had any continuing contact with any relatives who stayed behind. It was in a disputed area between Russia and Poland that was sometimes one country and sometimes another. I think that's where they were from.

Once he established this business, did he stay there, or did he go back to Canada?

Gary Becker: No, he never went back to live in Canada. What he did was move around in the United States for a while. He was manufacturing in New York City. I think he met my mother at that time. Then he moved around. He was in Shenandoah, Pennsylvania; Mount Holly, New Jersey; all small towns where he had small businesses of different types, distributorships. I don't even know all the different types of businesses he was in. But he was wiling to go into any business that looked promising, and that's what he did. And then finally, we settled in Pottsville for a longer period of time, although not my whole life by any means. Then he got wanderlust again, wanted to try another business, and we eventually moved into New York City and bought a business and he was in that for a while. So we never went back to Canada, never really maintained contacts with Canada, although years later when my mother was ill, he took her back to a physician in Montreal, and he bumped into people he knew, which was surprising after all the years he was gone.

It sounds like your father had an independent spirit. In your field, you have struck out independently and made great innovations. Do you think there's a connection there between his spirit and yours?

Gary Becker: Well I'd like to think so.

I had a great admiration for my father. I mean his independence. He had been set to go to Alaska, to open a business in Alaska, and his mother got ill and talked him out of doing it. Otherwise, that's how far he was willing to travel. He had a great independent spirit and channeled it into business activities. I like to believe that I follow him, and I channeled it into my own research activities. I certainly have been willing, like he was, to take chances on things that people thought would fail. I had more confidence and hopes that I would succeed. Yeah, so I trace a lot of it back to my father, and my mother, who, in her own way, was a free-thinker in a lot of ways.

Did she work too?

Gary Becker: No, my mother was full-time mother and housekeeper. She had four children. We had some help, but she did a lot of the work herself. Her free-thinking took another way. My father kept up with the news and read some. She didn't do that, but had more psychological insights into people. I always thought she had a lot of independent insight. It was a different insight. But I felt I got a lot from my mother as well as my father, and I thought both of them in their own ways were free-thinkers, although in other ways they were conventional. I think I followed them, in that in a lot of ways, I'm conventional. I'm not a rebel in dress or anything like that. But what free-thinking energies I have, I can channel into my work. I've fought a lot of my fights over my career, lost some, won some. But I think I've been willing to strike out on my own.

When were you first attracted to the field of economics? Was it something early on?

Gary Becker: I originally was in mathematics and thought I would go into mathematics. I went to Princeton, planning to go into mathematics, but I had a strong interest -- I think inherited from the discussions we had in my family, with my father and my brothers and sisters -- to do some good for society, that was my orientation. And then by happenstance, I took an economics course in my freshman year. Part of the course dealt with the use of mathematics. They were using mathematics -- the textbook had -- using mathematics to discuss economic questions. And it struck me, "This seems ideal for me, given my mathematics, my interest in math. I can combine it now to learn about my social problems." That's when I made the shift, and so it was, in a sense, early on in my college career, which is earlier than most people get so excited about economics. But I did get excited then. I thought I can use this as a way of doing good, if you will, in understanding and helping society.

When you were growing up, were there particular books that were important to you?

Gary Becker: We had almost no books in our household. My older sister was a big reader, and she had some books. My father, he read more of the newspapers and listened to the radio, and when he got television, watched television. But very few books. I can't say in the household there were books. When I was a student, I began to read. And when I was about -- again I made a conversion -- up until about 14, 15, I was more athletically oriented, played on a bunch of teams around and was a good student, but had no interest in really intellectual activities. And then, I can't really know why, I had a conversion, began to give up the sports and get more involved in reading. And starting at 16, 17, I read a lot then, at nighttime, going to the library. But as I say, we had no books, but I'd go to the library a lot. Philosophy, whatever kids at that age were interested in, I began to read. And so then I did read a lot, but the books we had, I had to get out of the library and so on.

Do you remember any that stand out?

Gary Becker Interview Photo
Gary Becker: I read some Aristotle and Plato. I remember I announced to my father when I was 17 or so, "Dad, I think I'm going to be a philosopher," and I remember his answer. My father was a bit blunt. He said, "Son, philosophers are born, they're not made." And he said, "You're not born to be a philosopher." That squelched me a little bit and I eventually shifted away from that. I read Progress and Poverty, about the single tax, by Henry George, who was famous in those days. It was written in the 19th century. That influenced a lot of us in economics. I didn't quite understand it, but it sort of dealt with a lot of issues. I read some literature of course. I had a great English teacher who introduced me to some of the great literature.

Do you remember the name of the teacher?

Gary Becker: Her name was Deborah Tannenbaum. She was a high school teacher I had.

I can only remember two teachers who really had an influence on me in high school, a math teacher, Morgenstern, and Deborah Tannenbaum. And I wasn't a particular... I mean, I got good grades, but I wasn't a particularly good writer or anything. But she liked me, and she thought I was a good student and I really thought she was a great teacher who introduced us to literature, poetry. We read Keats and Wordsworth and a lot of the great poets. I consider her very important, even though in a sense I didn't go into anything that she taught me. But she had an influence on me, teaching me the great thrill of reading something great in literature, which I then applied also to other areas.

You said that there were talks in your family about social justice and politics. What was that like?

Gary Becker: Well my father was kind of, sort of moderately on the left I would say. He was not a communist. I mean in those days communism was a big issue, whether you were a communist or not. It wasn't -- now that communism in the United States is a minor -- it was a significant issue, particular where we were growing up. My father was anti-communist but he was kind of a socialist. So we would discuss all the social -- and even though he was a businessman, he was still a businessman, but he was a socialist in his thinking. And we would discuss all the business, economic issues, social issues. My older sister was very smart, a very good thinker -- my older brother. So at the table and all, we'd have these lively discussions and that really started my interest. I have no doubt that's where it came from, the interest in my father and my brother and sister and a variety of -- I don't know how well informed our discussions were -- but they were lively and heated I would say. So I continued that, I think, in my career.

Were there other experiences or particular events in your youth that really stand out as formative ones?

Gary Becker: It's hard -- at least it's always hard for me -- to know. I think there was my love for math.

The only area I was precocious on was sort of an ability to calculate and do arithmetic, so I had some mathematical talent. I had a great love for math, love for social issues, trying to do something for society. I think those motivated me once I got to be a teenager. And then it was just a series of events, partly lucky. I went to Princeton, which is a great place. I didn't think I would get into Princeton, but they accepted me and I went there. Took the economics course, had a couple of good teachers when I was at Princeton, and a crisis in my study of economics when I was an undergraduate. I didn't feel... finally concluded it wasn't dealing with these important social issues. And I thought for a while about becoming a sociologist. Tried sociology but found it too difficult. I couldn't really get on top of it, as I began to read. And so came back to economics reluctantly, went to the University of Chicago, and that was a major... again, lucky. Most of my contemporaries, the advice we'd get would be to go to Harvard. And a lot, Princeton, in those days, if you were a good student and you wanted to go to grad school, you went to Harvard. I did get a very attractive offer from Harvard, but maybe this was my rebellious streak. I felt I wanted to do something different. Chicago seemed like... interesting. It was out in the Midwest. I hadn't been in the Midwest. It had a good department, I thought I'd try Chicago. And I did go to Chicago, and I encountered great teachers. Mainly I would say Milton Friedman had the greatest influence on me. And he taught me that you could use economics for powerful problems. That was really a revelation at that time. And I would say that was the next big, important event in my development.

Had he already won his Nobel Prize?

Gary Becker Interview Photo
Gary Becker: No. The Nobel Prize came much later. It only was started much later. So then, he was what now I would call a young economist. He looked older than me at the time. I was 20, he was about 40, so he's 20 years older than I am, approximately. But he was considered a powerful intellect already, and had enormous influence soon in the profession. He mesmerized all us graduate students, and in particular he did it for me. And again, what I got out of him, not only his brilliance and so on, but the feeling of how one could use economics to discuss things that had always interested me. That was a revelation.

At that point, did you decide, "This is my path," or were there still other things that you wanted to try?

Gary Becker: At that point, I thought I would become a professional economist and teacher. You know, you don't know what you're capable of doing, so I didn't really articulate it too well in my own mind, but I thought somehow I'd be an economist. I didn't know. Maybe I'd go into business, maybe not. I didn't know, but I knew I wanted to do economics, and I began to really feel fascinated by doing research on economics, and trying to struggle with some of these major problems using economics, using mathematics to understand these problems. So I was pretty convinced I wanted to do that at that time. But how it would work out, I didn't know.

What was your family's reaction when you went into this field?

Gary Becker: My mother was very dubious about my becoming an academic. She said, "The pay is so low." That's the first thing she told me, and I remember telling her, "Well, $10,000 a year will be enough for me." That's the number she said. "You won't make more then $10,000 a year." I said, "Well, I can live on $10,000 a year." Of course, $10,000... worth a little more today. It was low, but not so low. So she wasn't happy. My father was proud that I got a position at Columbia. He was quite proud of that. And while he originally thought I would go into business with my brother, he was proud of the fact that I went into academia. And my mother was... I think deep down she was proud about it. She worried about whether I'd be financially well enough off. But I think they were certainly supportive. My father, for sure, was supportive of this move on my part, 'cause I was the first academic in our extended family, and to get a position at Columbia was, you know, a great university. They were proud of me.

How many brothers and sisters do you have?

Gary Becker: I had two sisters and a brother.

Where are you in the line-up?

Gary Becker: I'm third. I had an older brother and an older sister.

Did they go on to college?

Gary Becker: We all went to college. My brother went to MIT and got a Master's and a Bachelor's degree there, and a law degree ultimately he got. So he got a lot of degrees. My older sister graduated from NYU, my younger sister got three or four degrees, so we all went on. They didn't become academics though. My brother became a chemical engineer and worked for a large company, Monsanto, and eventually he founded his own company. My oldest sister -- unfortunately she died when she was 38 years old -- but she had become a top executive in what's called the Asia Society, in the New York area. My younger sister is now a psychoanalyst. So they've all become professionals, although I was the only one who became an academic.

Have you given any attention to Frank Sulloway's book on birth order, Born to Rebel?

Gary Becker: I can't say I've paid a lot of attention to it. I've read some of the birth order literature in general. He talks about the first born...

He says the younger siblings are often the more creative ones. They're historically the ones that foment revolution and discover new genres and so forth.

Gary Becker: It seemed like a very interesting thesis. In my case I don't know how applicable it was. I always thought my oldest sister was extremely talented, but she died too young, so she didn't have time to really bring out all her talents. But she had a very good career on the way.

What happened to her?

Gary Becker: She had breast cancer. My mother died of breast cancer at a young age, but not that young, and then my sister died, so it was a terrible tragedy that happened to her. She had a lot of rebellious aspects to her. My brother was less rebellious, and was quite successful. I certainly felt I was influenced a lot by what they did ahead of me. They paved the way a lot for me.

You left Columbia after the campus disturbances of 1968. Could you tell us about your reaction to that turbulent period?

Gary Becker Interview Photo
Gary Becker: I was very upset about that. Not so much by the students. You have young students, I can understand that. They were doing things, some of them that I didn't think were appropriate for a university. My colleagues really bothered me a lot. I felt they didn't stand up and show a clear enough light for what a university should stand for, and that would guide a lot of the students who really were unhappy also about what was going on. They didn't have sufficient guidance from the faculty, which was terribly split, including my own department. I was for a much more firmer stand, that universities should not be intimidated, and should not allow free speech to be kept down. Faculties are very used to discussing and not used to action, typically. You spend endless hours discussing and taking all sorts of views. So the faculty at Columbia was very split, my department was very split, and I was very angry at a lot of my colleagues for that, even senior colleagues who had brought me in. I was relatively young at the time, and I thought they would be the ones to take the leadership. I had to take the leadership. It was draining on me, and that, combined with other factors, led me to believe maybe I should be leaving Columbia, although I had been happy there up until that point. That's when I began to look around. Harvard made some inquiries, whether I wanted to go. I told them I was interested, but they finally sort of came back and they weren't that interested. Chicago had been interested in having me come back for years, and I kept putting them off. I finally decided to accept that.

So you thought your colleagues should have taken a firmer stand in support of free speech. You saw the situation at Columbia primarily as a free speech issue?

Gary Becker: I was a strong advocate of free speech, and that protest can go on, but you shouldn't intimidate lecturers and so on. We had several buildings occupied. You'd try to lecture and they tried to break into classrooms. That's what happened at Columbia and some other places at the time. I thought that was intolerable at a university. My colleagues probably deep down thought so, but they were unwilling to take any actions or express these thoughts. They wanted these students to like them, and sometimes you've got to do things that not everybody likes. That's what bothered me a lot. And particularly, as I say, it's not the students that bothered me so much. I mean, I felt the faculty should be more mature then the students, and they're older. Students were under a lot of peer pressure, even those who didn't want to go along with it, and they had to deal with them. So I never held it against any of my students, even those who participated actively, but I did hold it against a lot of my colleagues for doing that. And that was an important factor, as I said, in why I left.

How long had you been there altogether?

Gary Becker: Twelve years. I'd been there quite a while.

Did you have a family by then?

Gary Becker: Yes, I was married. I had two children at the time. In fact, I got married when I was 24, so at that time our two children were teenagers.

That's a hard time to pack up the family and move.

Gary Becker: It was a hard time. The two girls were willing to leave. My wife -- this was my first wife -- was more reluctant at the time, but she finally decided to go.

Aside from the fact that your research was not accepted as significant for a period of years, were there other major setbacks in your career?

Gary Becker: Well, my first wife died at a young age, so that was a personal setback, but it certainly affected me personally and career-wise.

How old were your children then?

Gary Becker: It was shortly after we moved to Chicago, a year or so after we moved to Chicago. So Cathy was about 12, Judy was maybe 13 or 14. They were 11 and 13 or something like that. Professionally, I would say my main setback, if you call it a setback, was the fact that the areas I'd worked on took a long time to be recognized as major areas. Aside from that, my career went fine.

I didn't have a lot of universities interested in me. I've never gotten offers from the major institutions, aside from Chicago and Columbia. But I didn't consider that a setback. Chicago and Columbia were fine places, and I felt, well, that's the price of working on things that aren't so popular. So I accepted that. I didn't like it that my work wasn't received so well, but again, as I said earlier, I had this inner faith that I was right and they were wrong. I mean, I'll put it bluntly, that's what I felt. As did some of the people I respected so much, my teachers who had confidence in me, and a few other people, and that gave me further capacity to go on. So given my inner faith that what I was doing was important, it seemed obvious to me these are important problems and that I wasn't just a crazy man. There were some quite respected economists who thought I was doing important work, even though the bulk of the profession didn't. But that was enough for me. That kept me going. Everybody gets a little depressed, but I never went through any major depression over the fact that my work wasn't being accepted. I felt it will turn out to be that way. So I coped with my personal difficulties, with my wife's death. I remarried, a very fine marriage, my wife is here now, and she had two children who I'm very close to. So I sort of feel I have four children now, the two sons through her first marriage and my two daughters. So my personal life improved a lot. And finally, my work began to be accepted much more, I'd say sometime starting in the mid-'80s.

You had two adolescent girls to raise when your wife died, what a handful.

Gary Becker: It was difficult.

And hard for them.

Gary Becker: Very hard for them. It was a very difficult death. They went through a lot of difficulties, and it was hard for me. I was the mother and father to them for a number of years. So it was a difficult period, there's no question about. It was not an easy period.

And how long after that did you remarry?

Gary Becker Interview Photo
Gary Becker: I remarried about eight to ten years later. I was single for about eight or nine years I think. I met my second wife a few years before we married, so that was very good. We didn't actually marry until the end of the '70s. I think my wife died on January 1, 1970 or so.

Did the girls get along with their stepmother?

Gary Becker: They got along. There's always difficulties in these situations. That's why they write stories about it, but after some initial difficulties they worked out their difficulties and they have a good relation now, and with the two sons of my wife. So that's very good. The four children get along well. So that part has been good. Everybody goes through difficulties in their life. I've had my share, and I do believe the old saying that it makes you stronger. I think it does make you stronger not to have everything come easily. I think that's not only personally, but also professionally. I think I'm stronger professionally because my recognition did not come at a very early age, or did not come so smoothly. I think that's been helpful to me.

Could you tell us about the winning of the Nobel Prize? Can you describe the day?

Gary Becker: I had been down with 104 temperature for about a week before, and the last thing on my mind was whether they were awarding a Nobel Prize. I mean, it would be dishonest to say in the past I hadn't worried about whether I was going to get it. I had, along with most other people. No matter what they tell you, people are conscious of that. But then, I was out of my mind. They wanted me to go to the hospital and so on. And all of a sudden, I was just about recovering, and we got a -- five o'clock in the morning, my wife answered. She was up grading papers. She said, "My husband is sleeping. Who's calling?" She was very upset that somebody was calling that early in the morning. They said, "It's an important phone call," but she said, "But what do you want?" And they said, "Well, it's an important phone call. We'd like to speak to your husband." She said, "He's sleeping now, he's just getting..." they said, "Call from Sweden." So when she heard it was a call from Sweden, she figured something important, maybe not for me, maybe they wanted somebody's telephone number. So she got me up and I was reluctant. I went on the phone. And I don't usually show a lot of emotion in my face. And I'm saying, "Yes, yes," and she doesn't know what's going on. And all of a sudden I say, "Thank you. I appreciate this honor you've conferred on me. Please give my thanks to the rest of your committee," and she let out a scream. She'd knew I'd won.

It was a great shock. Surprise. Of course we were enormously elated over it. An extra reason was because of all this controversy I'd had in my work.

We went through all this period of time, all these years when my work was neglected, laughed at and so on. And now I got, so to speak, the ultimate recognition to anybody. And I felt good, not only for myself, but I had a lot of students and other people out there who had suffered a lot, who wrote me letters afterwards, how they were happier than I was about getting it, 'cause now they were respectable, and I think that the personal satisfaction of course was there. But it was more than that, it was this feeling that this was an official recognition, this class of work that I was involved in, that others were involved in. Some of them, many of them my students or my disciples, their work was being recognized, and to me that was worth as much as anything else to me. So the Nobel thing is a great week. I mean recognition and so on. Your head gets turned, you begin to think you're an expert on every issue they ask you to comment on. It's hard to avoid that Nobel disease, and I can't say I've avoided it completely either. I mean everybody gets caught up in it. But from a professional point of view, aside from the personal acclaim, the professional point of view, recognition after all the fights I went through, to me and all these others, I think that was the most important thing for me.

What do you think about the American Dream? Do those words mean something to you?

Gary Becker: My parents were both immigrants. So if you ask, my mother came when she was six months, but she liked to feel that she was European, she wasn't an American. My father, clearly, came to this country when he was 14 and it was for a dream to get employed. I've always been a very strong proponent of immigration and the like, because I think the American Dream is real. We provide the opportunities for people. I came from an uneducated family, as I said, no books in the house. But the opportunities provided by this country were enormous, and that's why I feel so patriotic, so proud to be an American. You won't catch me attacking. I mean the U.S. makes a lot of mistakes, but I won't attack America, because I think it's a great country, and I think it's continued to provide for opportunity for people and there's no country in the world that provides these kind of opportunities. So I think it's a real dream, and what we and the younger generations have to do is continue that dream, that people from all walks of life can succeed. It isn't the contacts you have, it isn't the networks you have, although they count. But if you're willing to work hard enough and keep your mind on a goal, and willing along the way to take criticism, that the chances that you'll succeed, for everybody, is considerable. And that to me is the American Dream.

Gary Becker Interview Photo
So I think it's a great dream. It's still alive, and I don't want to sound too emotional, but I think this is just a great country. My wife is an immigrant. She had brothers who came out from Iran, who came out after the revolution, who were trained in Europe. They went to Europe, and they eventually came here. They just weren't accepted in Europe the way they are accepted in the United States. In the United States, everybody's an immigrant, or not too long ago was an immigrant. So I think it is a great dream, and a lot of the people this year, and in previous years on this program, are simply reflections of the fact that there is this dream here, and that people can make it. You can do it in other countries, but the opportunities in every field of endeavor are not matched, as far as I know, by any country of the world as they are in the United States. So yes, I have strong feelings about the American Dream, 'cause I think it's a real dream.

Thank you so much. It's been a pleasure.




This page last revised on Mar 31, 2011 18:30 EDT