Elinor Ostrom was the recipient of the Nobel Prize in Economics in 2009 — the first woman to achieve the distinction — for her analysis of economic governance, especially the governance of common property like air, water and public spaces. Virtually all the world's most urgent problems require collective action. Be it environmental protection, the international financial system or the dimensions of inequality, Ostrom's work sheds light on the direction society must follow to avoid misuse of shared resources, "the tragedy of the commons."
Ostrom, 78, has done field studies of the world's fisheries, roamed with shepherds in Swiss pastures and trudged around the Los Angeles water basin to distill the essentials of harnessing cooperation to overcome selfish interests.
After the TARP bailouts and the devastation of democracies in Europe by financial technocrats, the world is again beginning to appreciate what Elinor Ostrom has deeply, persistently and quietly been illuminating for nearly 50 years.
Paul Dragos Aligica discussed her achievements that led to the Nobel Prize:
"When economists show that market arrangements fail, they usually make the simple recommendation that “the” state should take care of these problems. Elinor Ostrom has demonstrated empirically that “the” state may not be “the” solution. Her work argues for the wisdom of institutional diversity, looking to individuals to solve problems rather than relying on top down, one-size-fits-all solutions...
And thus Ostrom’s study of governance is not only a source of inspiration, it is also a challenge to libertarians. In study after study, she has shown that the principles of individual freedom, responsibility, entrepreneurial creativity, and resourcefulness apply not only to the production and distribution of private goods, they also apply to a large institutional domain outside the market order."
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