It is with great sorrow that the United Nations University announces the death of Nobel Laureate Professor Douglass C. North on 23 November 2015 (age 95). He was Spencer T. Olin Professor in Arts and Sciences at Washington University in St. Louis, and gave the very first WIDER Annual Lecture. This initiated a series of annual lectures — 19 so far — that has been important to the international profile of UNU-WIDER over the years.
Prof. North’s major interest was the evolution of economic and political institutions. He was highly influential in encouraging economists to look again at the institutional underpinnings of economic prosperity — in particular, the way in which transaction costs in market exchanges encourage the formation of institutions, such as secure property rights that reduce such costs. His work became highly influential in the late 1980s and 1990s, as the transition economies of East Europe, the former Soviet Union, and China, engaged in deep, and often problematic, market reforms with varying degrees of success.
In 1997, in giving the WIDER Annual Lecture, Prof. North stressed the importance of understanding the economic significance of institutions. The lecture was published as “The Contribution of the New Institutional Economics to an Understanding of the Transition Problem“. This was at a time when the movement of the centrally-planned economies towards market economies was still ongoing, with many questioning the early enthusiasm for market liberalisation in the context of very weak regulatory institutions. In that annual lecture, he wrote: “Policy makers were confronted not only with restructuring an entire society, but also with the blunt instrument that is inherent in policy changes that can only alter the formal rules but cannot alter the accompanying norms and even have had only limited success in inducing enforcement of policies.” This is as true today as it was nearly twenty years ago and has application to a wide range of economic situations, not least those of countries emerging from conflict and violence.
Professor North was co-recipient (with Robert William Fogel) of the 1993 Nobel Memorial Prize in Economic Sciences for his research on the economic history of the USA and Europe, as well as for his significant contributions to understanding how economic and political institutions change over time.