Douglass North, Nobel Winner for Economic History, Dies at 95

Douglass North
Douglass North. Source: Washington University in St. Louis

Douglass North, who won a Nobel Prize for his studies of how political, social and other noneconomic forces shaped the economic growth of nations throughout history, has has died. He was 95.

He died Nov. 23 at his residence in Benzonia, Michigan, according to a statement on the website of Washington University in St. Louis, where he was professor emeritus.

The Royal Swedish Academy of Sciences awarded North and University of Chicago economist Robert Fogel the 1993 Nobel in economics “for having renewed research in economic history by applying economic theory and quantitative methods in order to explain economic and institutional change.” Both men were pioneers in applying modern mathematics to the study of history, a field known as new economic history, or cliometrics, after Clio, the muse of history in Greek mythology.

North focused on the role of institutions -- the rules and conventions of a society, such as laws, property rights, insurance, politics and customs -- in long-term economic development.

In a 1968 article, he argued that improved productivity in ocean shipping from 1600 to 1850 was due more to organizational changes -- the rise of international trade and the drop in piracy, which reduced insurance costs and the need for manpower and armament -- than to technological innovations, such as faster ships. That paper became “one of the most quoted research works in economic history,” the Nobel organization said in announcing North’s award.

Economic Advances

“Putting it simply,” the organization wrote, “North maintains that new institutions arise when groups in society see a possibility of availing themselves of profits that are impossible to realize under prevailing institutional conditions.”

North was a professor for 15 years at the University of Washington in Seattle before moving in 1983 to Washington University in St. Louis. There, he founded the Center in Political Economy, which he directed until 1990.

“We have a long way to go in understanding the way economies and societies evolve through time,” North said in accepting his Nobel, “but the progress of the past three decades augurs well for the future.”

Early Life

Douglass Cecil North was born on Nov. 5, 1920, in Cambridge, Massachusetts, the youngest of three children. His father was a manager at Metropolitan Life Insurance Co., and for his work, he moved his family to Connecticut, then to Ottawa, where his youngest son began school. He also attended classes in Lausanne, Switzerland, before completing high school at the Choate School in Wallingford, Connecticut, now called Choate Rosemary Hall.

At the University of California-Berkeley, North became “a convinced Marxist” while majoring in political science, philosophy and economics, according to Nobel autobiography. Not wanting “to kill anybody” during World War II, he joined the U.S. Merchant Marine after graduating in 1942 and became a navigator on Pacific Ocean routes.

Dissertation Topic

Choosing economics over his other passion, photography, North returned to Berkeley for graduate studies, hoping “to find out what made economies work the way they did or fail to work.” He earned his Ph.D. in 1952 with a dissertation on the history of life insurance in the U.S.

He began teaching economics in 1950 at the University of Washington in Seattle. As a research associate at the National Bureau of Economic Research in 1956 to 1957, he was exposed to what he later called the “substantial stirring to try to change and transform economic history.”

Explaining Changes

His first book, “Institutional Change and American Economic Growth,” written in 1971 with Lance Davis, analyzed American economic history from 1790 to 1860. In Geneva on a fellowship in 1966, he turned his attention to European economic history and “quickly became convinced that the tools of neo-classical economic theory were not up to the task of explaining the kind of fundamental societal change that had characterized European economies from medieval times onward,” he wrote in his autobiography. “We needed new tools, but they simply did not exist.”

Much of his later career would focus on developing such tools. He also delved into cognitive science to weigh how people make choices that lead to economic change.

At Washington University in St. Louis, North founded the Center in Political Econony.

With Ronald Coase, who won the economics Nobel in 1991, North created the International Society for the New Institutional Economics in 1997.

North and his first wife had three children: Douglass, Christopher and Malcolm. He married Elisabeth Case in 1972.

Related ticker: 708376Z US (Washington University in St. Louis)

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