From the The (WSJ) Morning Brief:
Two American economists, Elinor Ostrom and Oliver Williamson, who study the way decisions are made outside the markets on which many other economists focus, were awarded the Nobel Prize in economics Monday.
Ms. Ostrom, who teaches at Indiana University in Bloomington, Ill., is the first woman to win the prize, which, before Monday, had been awarded to 62 men since it was launched in 1969 to celebrate the 300th anniversary of the Swedish bank. The judges cited "her analysis of economic governance, especially the commons," the way in which natural resources are managed as shared resources. It is an area of research that she said was relevant to questions surrounding global warming, and suggests that decisions by individuals can help solve the problem even as governments work to reach an international agreement.
Ms. Ostrom "challenged the conventional wisdom that common property is poorly managed and should be either regulated by central authorities or privatized," the Nobel judges said. "Based on numerous studies of user-managed fish stocks, pastures, woods, lakes, and groundwater basins, [Ms.] Ostrom concludes that the outcomes are, more often than not, better than predicted by standard theories. 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."