Mancur Olson

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Mançur Olson
Mancur Olson.jpg
Born
Mançur Lloyd Olson Jr.

(1932-01-22)January 22, 1932
DiedFebruary 19, 1998(1998-02-19) (aged 66)
NationalityAmerican
Institution University of Maryland
Princeton University
Field Institutional economics
School or
tradition
New institutional economics
Alma mater Harvard University (PhD)
University of Oxford (MA)
North Dakota State (BA)

Mançur Lloyd Olson Jr. ( /ˈmænsər/ ; [2] January 22, 1932 – February 19, 1998) was an American economist and political scientist who taught at the University of Maryland, College Park. His most influential contributions were in institutional economics, and in the role which private property, taxation, public goods, collective action, and contract rights play in economic development.

Contents

Education and career

Olson graduated from North Dakota State University, and was a Rhodes Scholar at University College, Oxford before he earned a PhD in economics from Harvard in 1963.

His first job was as an assistant professor at Princeton University. Afterwards, he served as Deputy Assistant Secretary of Health, Education and Welfare for two years in Washington, D.C. In 1969 he left government and joined the economics department of the University of Maryland, College Park, where he remained until his death. [1]

Legacy

Academic work

In his first book, The Logic of Collective Action: Public Goods and the Theory of Groups (1965), he theorized that what stimulates people to act in groups is incentive; members of large groups do not act in accordance with a common interest unless motivated by personal gain (economic, social, etc.). While small groups can act on shared objectives, large groups will not work towards shared objectives unless their individual members are sufficiently motivated. [3]

In 1982, he expanded the scope of his earlier work in an attempt to explain The Rise and Decline of Nations (1982). He argues that groups such as cotton farmers, steel producers, and labor unions have an incentive to form lobby groups and influence policies in their favor. These policies will tend to be protectionist, which will hurt economic growth; but because the benefits of such policies are concentrated, and their costs are diffused throughout the whole population, there will be little public resistance to them. As distributional coalitions accumulate, nations burdened by them will fall into economic decline. His work influenced the formulation of the Calmfors–Driffill hypothesis of collective bargaining. [4]

In his final book, Power and Prosperity (2000), Olson distinguished between the economic effects of different types of government, in particular, tyranny, anarchy, and democracy. Olson argued that under anarchy, a "roving bandit" only has the incentive to steal and destroy, whilst a "stationary bandit"—a tyrant—has an incentive to encourage some degree of economic success as he expects to remain in power long enough to benefit from that success. A stationary bandit thereby begins to take on the governmental function of protecting citizens and their property against roving bandits. In the move from roving to stationary bandits, Olson sees the seeds of civilization, paving the way, eventually for democracy, which by giving power to those who align with the wishes of the population, improves incentives for good government. [5] Olson's work on the roving vs. stationary bandits is influential in analysis of the political and economic order structured in warlord states and societies.[ citation needed ]

Policy work

To help bring his ideas to the attention of policymakers, Olson founded the Center for Institutional Reform in the Informal Sector ("IRIS Center"), funded by USAID (United States Agency for International Development). Based at the University of Maryland, the Center sought to supply an intellectual foundation for legal and economic reform projects carried out by USAID in formerly communist states that were attempting to make the transition to market-driven democratic governments governed by the rule of law. It was particularly active in East and Central Europe and the former Soviet Union.

The Center also became actively involved in projects in South America, Africa, and Asia, where it became a proponent of judicial independence. It sponsored the first conference on corruption in francophone Africa in the 1990s, when it was a very sensitive subject. The IRIS Center continued to operate after Olson's death, but was eventually folded into other programs at the University of Maryland.

To honor Olson's many contributions, the American Political Science Association established the Olson Award for the best PhD dissertation in Political Economy. [6] In 2013 the University of Maryland announced the creation of a new endowed professorship—the Mancur Olson Professor of Economics. [7] Maryland Professor of Economics Peter Murrell was the first Mancur Olson Professor.

Selected works

Books

Articles

See also

Related Research Articles

Dictatorship Authoritarian form of government

A dictatorship is a form of government characterized by a single leader (dictator) or group of leaders that hold government power promised to the people and little or no toleration for political pluralism or independent media. In most dictatorships, the country's constitution promise citizens rights and the freedom to free and democratic elections; sometimes, it also mentions that all these aforementioned rights will be granted to the people, but this is not always the case. As democracy is a form of government in which "those who govern are selected through periodically contested elections ", dictatorships are not democracies.

Stagflation Both high inflation and high unemployment

In economics, stagflation or recession-inflation is a situation in which the inflation rate is high, the economic growth rate slows, and unemployment remains steadily high. It presents a dilemma for economic policy, since actions intended to lower inflation may exacerbate unemployment.

Autocracy Government by a single person with unconstrained power

Autocracy is a system of government in which absolute power over a state is concentrated in the hands of one person, whose decisions are subject to neither external legal restraints nor regularized mechanisms of popular control.

Public choice, or public choice theory, is "the use of economic tools to deal with traditional problems of political science". Its content includes the study of political behavior. In political science, it is the subset of positive political theory that studies self-interested agents and their interactions, which can be represented in a number of ways – using standard constrained utility maximization, game theory, or decision theory. It is the origin and intellectual foundation of contemporary work in political economy.

Collective action Action taken together by a group of people to further a common objective

Collective action refers to action taken together by a group of people whose goal is to enhance their condition and achieve a common objective. It is a term that has formulations and theories in many areas of the social sciences including psychology, sociology, anthropology, political science and economics.

Military alliance Alliance between different states with the purpose to cooperate militarily

A military alliance is a formal agreement between nations concerning national security. Nations in a military alliance agree to active participation and contribution to the defense of others in the alliance in the event of a crisis. In the event a nation is attacked, members of the alliance are often obligated to come to their defense regardless if attacked directly. In the aftermath of the Second World War military alliances usually behave less aggressively and act more as a deterrent. Military alliances differ from coalitions, which formed for a crisis that already exists.

Complexity, Problem Solving, and Sustainable Societies is a paper on energy economics by Joseph Tainter from 1996.

Centralisation or centralization is the process by which the activities of an organisation, particularly those regarding planning and decision-making, framing strategy and policies become concentrated within a particular geographical location group. This moves the important decision-making and planning powers within the center of the organisation.

Rent-seeking is the effort to increase one's share of existing wealth without creating new wealth. Rent-seeking results in reduced economic efficiency through misallocation of resources, reduced wealth-creation, lost government revenue, heightened income inequality, and potential national decline.

While the monopoly on violence as the defining conception of the state was first described in sociology by Max Weber in his essay Politics as a Vocation (1919), the monopoly of the legitimate use of physical force is a core concept of modern public law, which goes back to French jurist and political philosopher Jean Bodin's 1576 work Les Six livres de la République and English philosopher Thomas Hobbes' 1651 book Leviathan. Weber claims that the state is the "only human Gemeinschaft which lays claim to the monopoly on the legitimated use of physical force. However, this monopoly is limited to a certain geographical area, and in fact this limitation to a particular area is one of the things that defines a state." In other words, Weber describes the state as any organization that succeeds in holding the exclusive right to use, threaten, or authorize physical force against residents of its territory. Such a monopoly, according to Weber, must occur via a process of legitimation.

Club good

Club goods are a type of good in economics, sometimes classified as a subtype of public goods that are excludable but non-rivalrous, at least until reaching a point where congestion occurs. Often these goods exhibit high excludability, but at the same time low rivalry in consumption. Thus, club goods have essentially zero marginal costs and are generally provided by what is commonly known as natural monopolies. Furthermore, Club goods have artificial scarcity. Club theory is the area of economics that studies these goods. One of the most famous provisions was published by Buchanan in 1965 "An Economic Theory of Clubs," in which he addresses the question of how the size of the group influences the voluntary provision of a public good and more fundamentally provides a theoretical structure of communal or collective ownership-consumption arrangements.

In economics, a privileged group is one possible condition for the production of public goods.

A benevolent dictatorship is a government in which an authoritarian leader exercises absolute political power over the state but is perceived to do so with regard for benefit of the population as a whole, standing in contrast to the decidedly malevolent stereotype of a dictator who focuses on their supporters and self-interests. A benevolent dictator may allow for some civil liberties or democratic decision-making to exist, such as through public referendums or elected representatives with limited power, and often makes preparations for a transition to genuine democracy during or after their term. It might be seen as a republican form of enlightened despotism.

The Logic of Collective Action: Public Goods and the Theory of Groups is a book by Mancur Olson, Jr. published in 1965. It develops a theory of political science and economics of concentrated benefits versus diffuse costs. Its central argument is that concentrated minor interests will be overrepresented and diffuse majority interests trumped, due to a free-rider problem that is stronger when a group becomes larger.

The Virginia School of political economy is a school of economic thought originating in universities of Virginia in the 1950s and 1960s, mainly focusing on public choice theory, constitutional economics, and law and economics.

Sir Timothy John Besley, is a British academic economist who is the School Professor of Economics and Political Science and Sir W. Arthur Lewis Professor of Development Economics at the London School of Economics (LSE).

The concertina model, sometimes referred to as the concertina rule or "concertina method", is an international trade liberalisation strategy, which consists of removing the highest tariffs first. Amiti traces this "idea back to Meade who concluded that the welfare gains will be larger if tariffs on those goods with the highest tariffs are reduced first. This result was formalized by a number of authors, including Bertrand and Vanek (1971) and Falvey (1988) for a small, open, perfectly competitive economy."

The concept institutional sclerosis was first introduced by American economist and social scientist Mancur Olson, in his book The Rise and Decline of Nations, published in 1982. Olson argues that the number of interests groups within a society has a sclerotic effect on economic growth. It seeks to explain economic growth and performance of societies across different countries by focusing on the role of institutions - specifically interest groups.

The Periods of Stagflation, also known as Stagflation in Pakistan or inflation and unemployment in Pakistan, are periods of economic stagflation in Pakistan's economic history, which has affected Pakistan's economic trajectory since its inception.

James A. Robinson (economist) British political scientist and economist (born 1960)

James Alan Robinson is a British economist and political scientist. He is currently the Reverend Dr. Richard L. Pearson Professor of Global Conflict Studies and University Professor at the Harris School of Public Policy, University of Chicago. He also serves as the Institute Director of The Pearson Institute for the Study and Resolution of Global Conflicts at the Harris School. Robinson has previously taught at Harvard University between 2004 and 2015 and also at the University of California, Berkeley, University of Southern California and the University of Melbourne.

References

  1. 1 2 Peter Passell (February 24, 1998). "Mançur Olson, 66, a Professor and Author of Economics Books". New York Times.
  2. The Economic Journal, Vol. 109, No. 456, Features (Jun., 1999), p. F445.
  3. Mancur Olson Jr., 1965, 2nd ed., 1971. The Logic of Collective Action: Public Goods and the Theory of Groups, Harvard University Press, Description, Table of Contents, and preview.
  4. Mancur Olson, 1982. The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities, Yale University Press, 1982. Description, chapter-preview links, and review quotes.
  5. Mancur Olson, 2000. Power and Prosperity: Outgrowing Communist and Capitalist Dictatorships, Oxford University Press. Description and chapter-preview links. Foreign Affairs review.
  6. Organized Section 25: Mancur Olson Best Dissertation Award
  7. "Archived copy". Archived from the original on 2013-12-02. Retrieved 2013-05-18.CS1 maint: archived copy as title (link)