Elinor Ostrom, a faculty member at both Arizona State University and Indiana University, won the Nobel Prize in Economic Sciences, which she shares jointly with Oliver E. Williams at the University of California Berkeley.
Ostrom's work challenges the traditional view that collective ownership of property will result in the "tragedy of the commons" -- that commonly owned property will be poorly managed, and should either be privatized or regulated by the government, or it will be exploited.
Think of it like overfishing in a public pond. Since everyone technically owns the fish, everyone feels like they can take as much as they want, and pretty soon there aren't any more fish.
The traditional economic "solution" has been to either privatize the resource (so the pond would be privately owned) or to levy heavy governmental taxes and regulations (meaning the fisherman would have to get permits to fish, and be taxed).
Ostrom's research finds this "conventional wisdom" to be simplistic.
"Based on numerous studies of user-managed fish stocks, pastures, woods, lakes, and groundwater basins, Ostrom concludes that the outcomes are, more often than not, better than predicted by standard theories," according to the prize committee. "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."
Elinor Ostrom is one of three ASU faculty to win the prize--and the second to win a Nobel in economics.
"This is a wonderful honor for Elinor, for ASU and for the State of Arizona," said ASU President Michael M. Crow in a press release. "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."