Economic Theory

Gary Stanley Becker is an American economist known for his efforts to extend economic analysis to social problems, especially those involving race and gender discrimination, crime and punishment, and the formation and dissolution of families. The essence of his contribution is that human behaviors rationally based on self-interest and the economic incentives of the marketplace. Cost-benefit analysis is central to Becker's analysis of social phenomena. He argues that couples tend to have fewer children when the wife works and has a better-paying job, when subsidies and tax deductions for dependents are smaller, and when the cost of educating children rises. Becker also argues that couples divorce when they no longer believe they are better off by staying married. Becker received a Nobel Prize in 1992.