Stephen Margolis’s Contributions to Economics and Political Economy
Originally published in The Independent Review
Margolis is a product of the University of California at Los Angeles (UCLA) Ph.D. program during the “Golden Era” of the 1970s, receiving his degree in 1978. This was a time of great contributions to microeconomics, in particular price theory and industrial organization, by UCLA economists, including Armen Alchian, Harold Demsetz, and Jack Hirshleifer. There were also significant contributions being made in macroeconomics by Robert Clower and Axel Leijonhufvud, which attempted to provide an alternative set of microfoundations to the New Classical Economics of the Chicago School. One important characteristic of the UCLA approach was that it studied economic forces at work rather than merely focusing on equilibrium states after the economics forces have done the job. In this sense, the UCLA tradition was one that focused on market processes and how the institutional framework of property rights, contract law, and the ordinary business of politics influences that market process. The key to the analysis was the incentive structure within which individuals found themselves operating rather than the individuals’ pure decision calculus.