The reaction of the economics community to Elinor Ostrom’s prize will likely be quite different. The reason? If you had done a poll of academic economists yesterday and asked who Elinor Ostrom was, or what she worked on, I doubt that more than one in five economists could have given you an answer. I personally would have failed the test. I had to look her up on Wikipedia, and even after reading the entry, I have no recollection of ever seeing or hearing her name mentioned by an economist. She is a political scientist, both by training and her career — one of the most decorated political scientists around. So the fact I have never heard of her reflects badly on me, and it also highlights just how substantial the boundaries between social science disciplines remain.Whose work is more consistent with good economics: somebody who takes methodological individualism seriously and studies spontaneous and emergent order, or somebody whose specialty is coming up with cute instrumental variables strategies for identifying relationships where endogeneity issues otherwise make inference difficult? One's economics, the other is applied statistics. If your view of economics is applied statistics, then maybe you won't have heard of Ostrom.
So the short answer is that the economics profession is going to hate the prize going to Ostrom even more than Republicans hated the Peace prize going to Obama. Economists want this to be an economists’ prize (after all, economists are self-interested). This award demonstrates, in a way that no previous prize has, that the prize is moving toward a Nobel in Social Science, not a Nobel in economics.
The part of the economics profession that would hate a prize going to Ostrom is the part I want nothing to do with. Writes Boettke:
But Lin Ostrom is firmly seated in the mainline tradition of economic scholarship from Adam Smith and David Hume to F. A. Hayek and James Buchanan --- As Lord Acton put it: “But it is not the popular movement, but the traveling of the minds of men [and women] who sit in the seat of Adam Smith that is really serious and worthy of all attention.” So in what sense is she not an "economist" in the proper sense of the word (remember her early work was on local public economics and her more recent work was on development economics)? It is because her methods were chosen to be appropriate to the task she was pursuing. Humanly rational choice, institutional analysis, field work, and experimental design were her tools for social understanding. She did not limit her work to that of Max U notions of "choice" nor instituitonally antiseptic models of 'markets' nor one size fits all models of economic development. Instead, she has been a major contributor to public choice economics, new institutional economics, and to our understanding of polycentricity and political economy.