Gary Stanley Becker was an American economist cum sociologist and pragmatist. He is held to be the most significant social scientist in the past 50 years by the New York Times (Justin, 2014). Becker was awarded the Noble Memorial Prize in Economic Sciences in 1992 for having long-drawn-out the arena of microeconomic analysis to a wide range of human behavior and interface, together with non-market behavior. He talked about racial discrimination and economic discrimination (Becker, 1968; Becker, 1971), gave an economic analysis and approach to crime, punishment (Becker, 1968), and drug addiction, gave an economic theory of fertility and family planning (Becker, 1969), the interaction between quality and quantity of children (Becker& Gregg, 1973).
Becker is credited with a theory of competition among the pressure groups for power and political impact (Becker, 1983). It was he who tried to build a relationship among human capital, effort, and the sexual division of labor (Becker, 1985) and theorize rational addictions. According to Becker, rationality means a regular and consistent plan for the maximization of utility over the period of time. Robust craving to a good needs a big impact of past consumption of the good on current consumption. Such influential and commanding complementarities create the graph of stability unstable one or some steady states to be unsteady (Becker & Murphy, 1988).
Human capital is the feature of human beings as far as creative, dynamic and productive work is concerned. It deals with the competence, skill development, knowledge upgradation and ability to work. Like physical capital, human capital helps in the capital formation and value-added production. Consequently, besides physical capital formation, human capital formation promotes economic growth and economic development. ‘Human capital: a theoretical and empirical analysis, with special reference to education’ is Gary Becker’s 1964 classic book that has gone through three editions right from its inventive publication. It was a fundamental argumentation for the expansion of human capital. According to the worthy scientist, individuals invest in human capital grounded on rational benefits, cost and paybacks that take account of a return on investment coupled with a social and cultural aspect. His research findings contained within its ambit the impact of optimistic and pessimistic behaviors and habits such as timekeeping and intoxication on human capital. In this attempt, he discovered the different rates of return for different people and the subsequent macroeconomic policy implications (Becker, 1993).
Inductive and deductive ways are the two very distinctive and contrasting instructional approaches which offer certain rewards, but the main difference is the role of the teacher. The former is more student-centric making the use of a noticing strategy while as the latter is more teacher-centric. In latter, a lesson is conducted by the teacher by presenting and clarifying concepts to students and then supposing students to complete their tasks to rehearse the concepts. And, such distinctions help in the better facilitation of student learning. Becker distinguished between inductive and deductive learning and their impact on job-firing and promotions. He gave the theory of allocation of time between different activities. The postulate that households are producers, as well as consumers, lies at the heart of the theory and they produce commodities by way of the interaction of inputs of goods and time according to the cost-minimization rules laid down in the conventional theory of the firm. The goods are produced in quantities determined by maximizing a utility function of the set of goods subject to prices and a constraint on resources, both budget and time constraint. Time management involves at the same time a restructuring of goods and commodities, all three decisions become closely interrelated (Becker, 1965).
In the area of the distribution network, historically we have three existing models-state, market, and state–market mix. But, here we are concerned with the market mode of distribution which functions on the basis of price or market mechanism. In this system, goods and services are made available in the market and on the basis of their demand and supply, their prices are determined in the open market and finally, they get distributed to the population. In other words, under the market mode of distribution, prices are set by the forces of demand and supply. This was the distribution system of the capitalist economies-the whole Euro-America till the Great Depression of the 1930s (Singh, 2013). A free market in economics is a flawless economic system. Gary Becker and Julio Elias (2007) modeled organ markets for Live and Cadaveric Organ Donations. They postulated that a free market can solve an economic problem (the problem of a scarcity) in organ transplants and estimated the price tag for human kidneys ($15,000) and human livers ($32,000). Critics point out that such organ markets have the capacity to exploit the disadvantaged donors from developing economies.
Why do rich countries have small families? Why do business corporations and firms in poor countries provide incentives and meals for their workers? Why is the years of schooling for each new generation higher than the one that came before? Why are the earnings of highly skilled workers higher than the low skilled workers? Why have the quantity and quality levels of highly skilled workers increased? Why should seat of higher learning centers like universities and research institutes charge teaching and training costs and fees? Once we reminisce upon Gary Becker’s socio-economic thoughts we can find convincing answers to these questions through which runs the common thread of human capital.
Nothing is impossible before strong will and determination provided it is guided by the righteous people and resources in the nick of time is what we understand by Beckernomics or Gary Becker’s notions. We can create a utility or produce commodities by way of the good interaction of physical inputs and physical output, and time according to the cost-minimization rules. The economic treatise and thoughts of Gary Becker teach us time management, among other things.
Becker, Gary S. (1965). A theory of the allocation of time. The Economic Journal. Vol. 75 (299). Pp. 493–517
Becker, Gary S. (1968), “Discrimination, economic”, in Sills, David L., International Encyclopedia of Social Sciences, Vol. 4 Cumu to Elas, New York, New York: Macmillan, pp. 208–10
Becker, Gary S. (1968). “Crime and punishment: an economic approach. Journal of Political Economy. Vol. 76 (2): 169–217.
Becker, Gary S. (1969), “An economic analysis of fertility. National Bureau of Economic Research. Demographic and economic change in developed countries, a conference of the universities, New York: Columbia University Press. pp. 209–40
Becker, Gary S. (1971). The economics of discrimination. Chicago: University of Chicago Press.
Becker, Gary S.; Lewis, H. Gregg (1973). “On the interaction between the quantity and quality of children. Journal of Political Economy. Special Issue: New Economic Approaches to Fertility (part 2). Vol. 81 (2): pp. 279-288
Becker, Gary S. (1973). A theory of marriage. Journal of Political Economy. Vol. 81 (4): 813–46.
Becker, Gary S. (1985). Human capital, effort, and the sexual division of labor. Journal of Labor Economics, Special Issue: Trends in Women’s Work, Education, and Family Building (part 2). Vol. 3 (1).
Becker, Gary S.; Elías, Julio Jorge (Summer 2007). “Introducing incentives in the market for live and cadaveric organ donations. Journal of Economic Perspectives.Vol. 21 (3): 3–24.
Becker, Gary. (1993). Human capital: a theoretical and empirical analysis, with special reference to education (3rd Ed.). Chicago: The University of Chicago Press.
Gary S. Becker and Kevin M. Murphy. (1988). A Theory of Rational Addiction. Journal of Political Economy. Vol. 96 (4). pp. 675-700.
Singh, R. (2013). Indian Economy. 5e, McGrawHill Education (India) Private Limited.
Wolfers, Justin. (2014). How Gary Becker transformed the Social Sciences. New York Times.Retrieved fromhttps://www.nytimes.com/2014/05/06/upshot/how-gary-becker-transformed-the-social-sciences.htmls
The author is a Research Scholar at the Department of Economics, Central University of Kashmir, an Academic Counsellor, IGNOU STUDY CENTRE 1209, S.P. College, Srinagar; and an Editor in EPH – International Journal of Business and Management Science & Asian Journal of Managerial Science. She is also Ezine Articles Expert Author and IJRULA title awards, 2018 winner (Best Researcher, 2018). She can be reached at: firstname.lastname@example.org