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Economists generally accept as a given the old adage that there's no accounting for tastes. Nobel Laureate Gary Becker disagrees, and in this lively new collection he confronts the problem of preferences and values: how they are formed and how they affect our behavior. He argues that past experiences and social influences form two basic capital stocks: personal and social. He then applies these concepts to assessing the effects of advertising, the power of peer pressure, the nature of addiction, and the function of habits. This framework promises to illuminate many other realms of social life previously considered off-limits by economists.

Preferences or tastes play a crucial part in virtually all fields of studey in economics and other social sciences, such as economic growth and capital accumulation, welfare analysis, effects of advertising, tax incidence, monopoly pricing, occupational choices, voting, peer pressure, and cultural influences. But with a few exceptions, economists and political scientists tipically pay little attention to the structure of preferences, while sociologists and anthropologists do not embed their analyses of social forces and culture in a powerful analytical framework.

Gary Becker

Gary Stanley Becker  (1930) – American economist, awarded the Nobel Prize for Economics in 1992. He applied the methods of economics to aspects of human behaviour previously considered more or less the exclusive domain of sociology, anthropology, and demography.

Becker was educated at Princeton University and the University of Chicago (Ph.D., 1955). He taught economics at the University of Chicago until 1957, when he moved to Columbia University; in 1970 he returned to the University of Chicago, where from 1983 he was professor of economics and sociology.

The central premise of Becker's writings is that rational economic choices, based on self-interest, govern most aspects of human behaviour, not just the purchasing and investment decisions traditionally regarded as economic behaviour. In his dissertation, published in 1957 as The Economics of Discrimination, he examined race discrimination in labour markets, concluding that it has costs for both the victim and the perpetrator. In Human Capital (1964) he argued that an individual's investment in education and training is analogous to a company's investment in new machinery or equipment. In studies such as the 1981 A Treatise on the Family, Becker analyzed the household as a sort of factory, producing goods and services such as meals, shelter, and child care. Applying theories of production to household behaviour, he was able to make predictions about family size, divorce, and the role of women in the workplace. Subsequent work focused on such subjects as criminal behaviour and addiction.