Remembering F.A. Hayek with Elinor Ostrom

In a couple of hours I will be attending this year’s Annual Hayek Memorial lecture. This year’s lecture will be delivered by Prof. Elinor Ostrom. She is the only woman to win the Nobel Memorial Prize in Economic Sciences for her “ analysis of economic governance, especially the commons”. Often all commons are lumped together as “Public Goods” and policy makers immediately call for central government regulation and control.

Ostrom’s Solution

An ever larger number of researchers – including Elinor Ostrom, the 2009 Nobel Prize winner in economics – has cautioned against single governmental units at global level to solve these global collective action problems, due in part to their complexity, and in part to the diversity of actors involved. Ostrom proposes a polycentric approach at various levels of society; with active oversight of local, regional and national stakeholders, where  key management decisions should be made as close to the scene of events and the actors involved as possible. Trond Vedeld

This rings true of Hayek’s problem on knowledge, where a central authority simply does not have the information and knowlegde to make the correct decisions. I am curious to know how Elinor Ostrom would improve coordination and the use of complex and dispersed information in the economy, to solve our contemporary economic problems and build a more robust society.