ASU Professor Elinor Ostrom Wins 2009 Nobel Prize in Economic Sciences

Arizona State University Research Professor Elinor Ostrom has won this year's Nobel Memorial Prize in Economic Sciences, a prize she shares with Oliver E. Williamson of the University of California at Berkeley.

Ostrom, who holds research positions at Arizona State University and Indiana University, is one of three faculty members at ASU to be a Nobel Prize recipient and the second in economics. Edward C. Prescott won the 2004 Nobel Prize in Economic Sciences and Leland "Lee' Hartwell won the 2001 Nobel Prize for Physiology or Medicine before joining the ASU faculty this fall.

At ASU, Ostrom is the founding director of the university's Center for the Study of Institutional Diversity. The center, established in 2008, is nestled in the School of Human Evolution and Social Change in ASU's College of Liberal Arts and Sciences. Ostrom is widely known for her study of institutions -- conceptualized as sets of rules -- and how they affect the incentives of individuals interacting in repetitive and structured situations.

At Indiana University, Ostrom and her colleagues at the Workshop in Political Theory and Policy Analysis developed the institutional analysis and development framework that provided a common structure for research on both urban and environmental policy issues over many decades. The framework enables the researchers to analyze diversely structured markets, hierarchies, common-property regimes, and local public economies using a common set of universal components.

"This is a wonderful honor for Elinor, for ASU and for the State of Arizona," said ASU President Michael M. Crow. "It is another example of how ASU faculty are working to solve real world problems, and how that work is receiving national and international recognition."

"Elinor Ostrom is not only a brilliant and innovative scientist who, by combining in an original way approaches in economics, anthropology, political science and decision-making has opened up many new perspectives in the study of institutions and decision-making, but also an extremely modest and generous scientist who has consistently invested great effort in sharing her insights with those most in need, in the U.S. and worldwide," says ASU colleague Sander van der Leeuw, director of the School of Human Evolution and Social Change at ASU.

"Through her 'workshop' in Indiana, and more recently also the Center for the Study of Institutional Diversity at Arizona State University, she has built a worldwide community of scholars in many different countries who apply her insights to the management of such common-pool resources as forests, water and the like. In my mind she exemplifies the kind of scientist we currently need most: transdisciplinary, and totally committed to the major issues our societies have to deal with," van der Leeuw says.

Ostrom was awarded the Nobel Prize "for her analysis of economic governance, especially the boundaries of the firm," according to the Royal Swedish Academy of Sciences. "Elinor Ostrom has demonstrated how common property can be successfully managed by user associations," the announcement read. "Elinor Ostrom has challenged the conventional wisdom that common property is poorly managed and should be either regulated by central authorities or privatized.

"She observes that resource users frequently develop sophisticated mechanisms for decision-making and rule enforcement to handle conflicts of interest, and she characterizes the rules that promote successful outcomes," the Royal Swedish Academy of Sciences noted.

In the July 24 issue of Science, Ostrom presents an updated version of a multilevel, nested framework for analyzing outcomes achieved in social-ecological systems.

Ostrom, a California native, received doctoral, master's and bachelor's degrees in political science from UCLA. She is a member of the National Academy of Sciences and a fellow of the American Association for the Advancement of Science and the American Academy of Arts and Sciences.

The Center for the Study of Institutional Diversity at ASU, which is focused on empirical and theoretical analyses of institutions -- or sets of rules -- melds laboratory research, field work, archival activities and mathematical and agent-based modeling in ways that are meant to guide policy-making and decision-making toward sustainable development. Linked social-ecological systems related to water, forests, pastures and other resource systems are of prime importance.