Yoram Barzel

I was a fan of Yoram Barzel many years before I met him. I knew him through his work. When I went to the University of Washington I went with the intention
of working with him, though I had no idea how that would come about. After only a week on campus I was shocked to find him standing at my door. He introduced
himself and asked if I would come to his office, he had a paper he wanted my opinion on. I was shocked. As he explained the paper to me, all I could think of
was "I'm standing in the great Yoram Barzel's office!" The only thing I heard him say was "well, what do you think?" What did I think? I hadn't thought about anything
except that I was standing in his office. I blurted out "I think the paper is quite long," and immediately realized Homer Simpson could have come up with
something better.  Yoram demonstrated his natural kindness by responding "Yes, I think you're right. It is too long."

That began a great friendship with a wonderful mentor. Yoram was a kindred spirit who looks at the world in just about the same weird way that I do. I've never heard
him talk politics or the weather, everything was always pure economics. Below is a great picture of Yoram, and below is the introduction I gave for his presidential
address to the Western Economics Association in the early 2000s.


In thinking about what I should say to introduce Yoram Barzel, I couldn’t help but think “what would Yoram’s thoughts be about Presidential introductions” I’m sure he would say:

 “No one remembers an introduction,
no one pays attention to an introduction,
everyone is just waiting for the real speaker to step up,
and besides it’s costly to prepare and listen to an introduction … so the  optimal thing  to say is nothing.”

However, I could never do that, if only because it is too great a personal pleasure to introduce my mentor and friend. 

Although Yoram has been a friend and father figure to many of us, I’m not going to focus on this aspect of his career today. Rather, I want to make 5 very brief points about his research achievements, which after all, are the grounds for his appointment as President of the WEA.

1.Yoram has been a lifelong researcher. After completing his Phd at the University of Chicago, Yoram published his first paper in Econometrica (that’s right, Econometrica) in 1963. Last year, Cambridge University Press published his book on the state. How many here think they’ll be publishing books with Cambridge when they are 70? In between he published approximately 40 articles and two other books. For 40 years Yoram has been crossing Lake Washington to spend his time writing in his 4th floor office at Savory Hall, and at 70 he shows no sign of slowing down. His work ethic is a tremendous example to us all, and stands in sharp contrast to the common custom of working hard until tenure and  then coasting or consulting until retirement.

2. Yoram has been versatile in research. Most probably know, although many might not, that Yoram was hired at the UW as an econometrician. If you look at Yoram’s work in the 1960s it is dominated by estimation of cost and production functions. This work was all published in top journals. Yoram’s work began to change with his 68 paper on innovation, and by 1974 with his publication of rationing by waiting he had completely switched over to studying property rights and transaction costs. What I find hard to imagine is that Yoram made this switch in his early 40s.  Again, at a time in life when most academics slow down and start to do derivative work, Yoram changed gears and had his biggest impact on the profession. Of course, this might also have resulted from the boredom in estimating production functions.

3. Yoram has been extremely influential.  There are many people in our profession with more than 40 papers to their credit. Yet very few of us have written papers that others care about. In contrast, some of Yoram’s papers are the most cited in our discipline, and his ideas permeate much of the writings of others. In particular his 68 paper on racing to innovate and his 76 paper on taxation are frequently ranked in the top 20 cited papers of all time. Other paper’s by Yoram are so important that they have defined a literature. Here I’m thinking of his 77 paper on information costs and his 82 paper on measurement. When people talk about the ABC’s of Property Rights, they might have Alchian and Coase in mind, but the B stands for Barzel. To a lot of us the work of Yoram is the bedrock of this field.

4. Yoram was ahead of his time.  Yoram’s idea that effort to capture property rights can be dissipating and that efforts are made to minimize this dissipation, is still not widely grasped. It is common now to talk of “multi-task agency” problems, “multiple property right dimensions”; “property rights”, “goods attributes” and often these ideas are referenced to other individuals, but all of these ideas go back to the work of Yoram in the 70s and early 80s.

5. Yoram’s work in interesting. When I was an undergraduate student a professor of mine caught me reading Yoram’s measurement cost paper in the library. Knowing my interests at the time he said “Are you reading that paper because it has “theory of the firm” in the title? “No” I responded, “I’m reading it because it has “Yoram Barzel” in the author.

Personally, I find much of what gets done in economics quite boring, but this can’t be said of Yoram … well ok, the paper on technology in steam power is pretty boring, but that’s the exception that proves the rule.  Part of Yoram’s talent is to choose topics and examples that spark interest. In measuring technical change he looked at the Indy 500, to examine labor markets he looked at slavery, to understand measurement costs he taught us about DeBeers’ diamonds. However, the real genius of Yoram’s work is that he always comes up with clever answers.

Many often comment or compare Yoram’s work with that of Steve Cheung’s. In the 1970s at the University of Washington, these two, along with Doug North and others, were the center of the universe for the study of property rights and transaction costs. It strikes me that Cheung was excellent at asking great questions: why sharecontracting, who sets the price in a price taker market, and the like. But when it came to great answers to even mundane questions, Yoram was king. Yoram could take an observation like “sometimes apples come in brown bags and other times they come in clear plastic ones,” and could come up with an answer that also explained every thing from vertical integration to price discrimination.

Finally,  I guess I can’t introduce Yoram without saying that he is one of the most gentle and nice people in the profession. I’m so glad that he was honored with the presidency because he deserved it for so many reasons. And with that it is now my pleasure to introduce to you, our speaker for today, … Professor Yoram Barzel.


One of the amazing things about Yoram is his stamina. In 2012 ISNIE held several sessions at their annual meeting in honor of Yoram.  Despite being 80 years old, he went to every session and stayed up with the younger folks into the night.  When he returned to the ISNIE meetings at Harvard in 2015, he behaved the same way.  Here are a couple of pictures from those meetings.

Yoram's wife Dina says that I look like Yoram. I think it is just the bags under our eyes.

My attempt to capture the moment as "art":

Yoram and Harold Demsetz. The two of the three last remaining original giants of the Property Rights field. Harold is two years older than Yoram, and on this night
he was awarded the Elinor Ostrom lifetime achievement award.  That's Scott Masten in the background, photo bombing an historic picture.