Sharon Oster, an influential economist and a towering figure in the history of the Yale School of Management, died on June 10, 2022, after a long battle with cancer. A member of the Yale SOM faculty since 1982, Oster was the school’s first tenured woman professor and first woman dean. She touched innumerable lives through her skillful and inspiring teaching, her rigorous application of economic ideas to nonprofit strategy, and her generous mentorship of junior scholars.
Oster stepped up to become the school’s dean under tumultuous circumstances in 2008, just as the global financial crisis was hitting its peak. She took decisive steps to keep the school moving forward, making necessary financial cutbacks while focusing energy and resources on critical student-facing functions, including the ongoing development of the then-fledgling MBA integrated curriculum. During her tenure, SOM broke ground on the construction of Edward P. Evans Hall, laying a literal and figurative foundation for the school’s growth and increasing influence in subsequent years.
Yale SOM’s current dean, Kerwin K. Charles, said that Oster’s leadership has had a long-lasting impact. “Sharon is esteemed and beloved throughout the SOM family for many reasons—her insightful scholarship, her generous mentorship, her exacting standards. Throughout her years at SOM, we profited hugely from the presence of her steady hand, as she guided the school towards more fully executing upon its mission. Her masterful management as dean is but one example. This institution is unimaginable without her imprint. Her enormous influence on so many aspects of life at the school is why her loss hits so hard and touches so many.”
Oster’s longtime colleague Judith Chevalier, the William S. Beinecke Professor of Finance and Economics, also noted how Oster’s commitment to the school’s mission has helped shape the institution. “It would be impossible to overstate Sharon’s role in shaping the distinctive mission and culture of the school. Sharon always held the view that the school’s role in training leaders for all sectors—business, nonprofits, and government—was a defining feature of the school. Generations of students viewed her Nonprofit Strategy class as their favorite and most important course at SOM. It is in large part due to Sharon’s commitment to the character of the school that our mayor, governor, and surgeon general are proud SOM graduates.”
As a faculty member, both before and after her deanship, Oster helped create and foster a culture characterized by a dedication to top-quality teaching and research. She won the school’s teaching award by student vote multiple times and was acclaimed by faculty colleagues for her commitment to advancing the careers of junior professors and exemplifying the highest standards of scholarship.
Scholar, Teacher, Mentor
Sharon Oster arrived at Yale in 1974 after completing her Ph.D. in economics at Harvard University, already the author of multiple published papers. She initially taught in the Department of Economics and moved to Yale SOM (then the Yale School of Organization and Management) in 1982. She received tenure in 1983 and was named the Frederic D. Wolfe Professor of Economics and Management in 1992. In her early years at the school, she taught microeconomics and competitive strategy; her demanding and enriching approach turned both courses into student favorites. Later, she developed a course on nonprofit strategy in response to student demand, and it became a keystone experience for generations of Yale SOM students; its lessons are still applied every day in boardrooms and nonprofit offices around the globe. Oster noted in a 2017 interview that the course also opened new veins of research for her and led to the publication of her widely used textbook Strategic Management of Nonprofit Organizations: Theory and Cases.
Oster wrote dozens of scholarly articles and case studies throughout her career. Her expertise ranged across competitive strategy, microeconomic theory, industrial organization, the economics of regulation and antitrust, and nonprofit strategy, and she wrote extensively on the regulation of business and competitive strategy. Several of her books are used widely in management and economics courses. Modern Competitive Analysis emphasizes an economic approach to strategic planning. She coauthored later editions of Principles of Economics with Ray C. Fair—her husband and a Yale colleague—and Karl E. Case. She also edited a volume of essays about how social enterprises can generate new revenue streams, Generating and Sustaining Nonprofit Earned Income: A Guide to Successful Enterprise Strategies.
Barry Nalebuff, an economist colleague since 1989, said that Oster’s research was pathbreaking and took on important issues. “Her research might seem mainstream today, but she was at the forefront of using an economist’s lens to look at women’s rights and discrimination more broadly,” he said.
Nalebuff pointed to her 1975 paper, “Industry Differences in Discrimination Against Women,” as an example. In it, Oster contested Gary Becker’s claim that discrimination is only possible when firms have market power. She did so by looking at the disparity in the fraction of women accountants across industries. Why should there be fewer women accountants in motor vehicles versus printing?
In “A Note on the Determinants of Alimony” (1987), Oster explained how the fact that alimony could in those days only go from men to women worked against women’s economic interests. This is because they could no longer contract with and hence induce a husband to invest in their career with a guarantee to get payback no matter what happens.
Oster's 1987 paper with Paul Milgrom on the Invisibility Hypothesis explained how invisibility leads to discrimination. Women and minorities get too few promotions in order to keep their talents hidden so that rivals don’t poach them.
Her colleagues on the Yale SOM faculty said that Oster’s approach to teaching and research—and to life beyond academia—set the tone for others around her. Nalebuff said, “Sharon created a community culture, one that has allowed us to attract and keep the world’s best talent. In a world of givers and takers, Sharon was the greatest giver and instilled that spirit in those around her. She trained all the new hires, myself included, to be part of an organization that chips in.”
Oster played a pivotal role in shaping both the economics group at Yale SOM and the academic culture at the school. Fiona Scott Morton, the Theodore Nierenberg Professor of Economics, said that Oster’s example inspired her colleagues to want to be better teachers, pointing out that as a result a high proportion of the economics faculty has won one of SOM’s teaching awards.
Oster also set an example as a citizen, according to Scott Morton. “She contributed to so many common goods. That’s an economics term that means things that are needed to make an organization go and that produce benefits for many but that aren’t always recognized—making sure students get jobs, serving on committees, local philanthropic boards.” Scott Morton remembered a time that Oster asked her colleagues to step in to judge a case competition—but only because she was already contributing to several other events for the school on the same weekend. “I got the sense that we were all being carried by her and her work building up students and the university.”
Oster served on a number of corporate and nonprofit boards throughout her career, including the Yale University Press and Amistad Academy. In a 2007 interview, she described how that service shaped her teaching, showing how economic principles apply—or don’t—when they encounter the complexities of organizational leadership.
In 2011, Oster’s lifetime of teaching and research was recognized with the American Economic Association’s prestigious Carolyn Shaw Bell Award, given to “an individual who has furthered the status of women in the economics profession.” Oster was nominated by former students, including Sandra Urie ’85, who wrote in her nomination letter: “She is an exceptional economist, an inspiring teacher, a friend, and mentor… Many, many generations of Yale students, especially the women who have had the opportunity to learn from her, are the beneficiaries of Sharon’s exceptional teaching.”
Oster served as a mentor throughout her career, even after she retired from teaching in 2018. Rachel Diaz, a member of the Yale College Class of 2020, said, “From the moment I transferred to Yale as a scared, first-generation community college transfer student to the day I graduated in the middle of a global pandemic in 2020, Sharon has been my biggest champion, and the first person I met who felt like family in a world that couldn’t have been more foreign. Sharon invited me into her home and her life, selflessly and whole-heartedly.”
Oster served as dean of Yale SOM from November 2008 until June 2011. She took the helm under trying circumstances. The previous dean, Joel Podolny, had left unexpectedly before the end of his term, and then-Yale President Richard Levin turned to Oster in order to bring continuity as well as energy and strategic acumen to the role. It turned out to be a pivotal decision for the school.
Yale SOM had recently launched a highly distinctive integrated MBA curriculum, but the approach was new and required heavy investments of faculty time and other resources to maintain. Oster decided to put the effort in to solidify and fine-tune the core, adding courses as needed and adjusting content. Strengthened at a key moment, the integrated curriculum remains the bedrock of the MBA program today.
Oster also oversaw much of the fundraising and planning for Edward P. Evans Hall—ground was broken for the new campus in the final months of her deanship—and helped ensure that the building would reflect the character of SOM and the approach needed to effectively teach the integrated curriculum.
When Oster became dean, multiple sources of income had been severely impacted by the financial crisis and the school faced projected deficits. In her first year, she steered the school into the black without sacrificing its core functions of teaching and research.
That set a pattern. The school finished the fiscal year with a surplus each year she was dean. And subsequent leaders built on what became a tradition of prudent fiscal management; the school now has a 14-year streak of avoiding deficits. At the same time, Oster managed to strengthen and grow the full-time faculty.
William N. Goetzmann ’86, the Edwin J. Beinecke Professor of Finance and Management Studies, said that Oster brought a number of skills to the deanship, including the insights gained from years of studying nonprofit strategy. “When the time came for her to step up as dean of the school, she was an inspiring, and remarkably successful leader. She was fearless in the realm we euphemistically call ‘development’—perhaps because she understood better than anyone the connection between nonprofit organizations and mission-interested donors.”
In the dean’s seat as in the classroom, Oster remained focused on helping students. Leading the school through the deepest economic downturn in a lifetime, she faced a depressed job market. Oster pledged $100,000 of her own salary to fund student internships at Yale, and she relentlessly worked her networks of former students and colleagues to turn up opportunities.
Stanley Garstka, now a professor in the practice emeritus of management, worked closely with Oster through this period as the school’s deputy dean. He said that Oster stood out as a leader because of both her expertise and her character. “It is always easy to work with someone who you admire and respect,” Garstka said. “Rather than just list a bunch of her accomplishments, which are many, I would rather note the marvelous attributes she possessed as a person—honesty, loyalty, intelligence, integrity, and her basic respect for people. Sharon knew who and what she was and lived her personal and professional lives accordingly. Even if we were to initially disagree with each other, we could reach a common ground and feel good about it, and about each other. You could never question Sharon’s loyalty to the school and its mission.”
When Oster stepped down as dean, her colleagues in the economics group, spearheaded by Fiona Scott Morton and Judith Chevalier, asked the alumni of the school to relate anecdotes that demonstrated how Oster’s teaching continued to benefit them. Tributes flowed in. Over and over, former students described how the lessons in economics that they absorbed in Oster’s classroom still shaped their thinking and led to both professional and personal triumphs.
Valued Friend and Collaborator
When Oster retired from active teaching in 2018, the school needed someone to teach the Nonprofit Strategy course, which had become a mainstay at the school. Judith Chevalier, a longtime colleague and friend, stepped in, cherishing the opportunity to co-teach the course with Oster for one semester. Their students recognized what a meaningful transition Oster’s retirement was, Chevalier remembered. “The students asked me what we were doing to commemorate Sharon’s last official SOM class, and I told them that Sharon had forbidden me to make too much of it, but that I would not prevent the students from undertaking some modest expression of their gratitude,” she said. “The students brought in homemade flags with Sharon’s picture on them, one of them led a procession playing the bagpipes, and they presented Sharon with a glass case with a replica of Wonder Woman’s crown.”
Will Goetzmann knew Oster first as a teacher when he attended SOM and later as a faculty colleague. The two coauthored papers about university endowments and art museums. “She was great fun to work with,” he said. “She understood research as serious play, and as an intellectual partnership. Anyone who knew her will know her dry, delightful humor and great conversation. I will deeply miss simply hanging out with Sharon Oster.”
Edward H. Kaplan, the William N. and Marie A. Beach Professor of Operations Research, was a colleague and “dear friend” of Oster’s for 35 years, and regularly started his mornings having coffee with Oster and Stan Garstka. “Sharon was a loyal friend,” Kaplan said. “I will never forget her (and Stan) accompanying me to Sloan Kettering dealing with my own health issues or being the first to console me when my mother died in 1991. She loved her family dearly and regularly updated me on their accomplishments, experiences, and vacations. She took special pleasure in telling me all about her grandchildren (and how they were already learning probability with pillows shaped like probability distributions!).”
Oster was completely devoted to her family. She and her husband, Ray Fair, also an economist, were married for 45 years. They raised three children—Emily Oster, Stephen Fair, and John Oster—in a home filled with love and, also, some economics. One of her children recalled being told the reason that the family had their groceries delivered was because Sharon and Ray had a “high opportunity cost of time.” That her family has stayed close as they became adults was among Oster’s greatest joys and a source of great pride. She is survived by her children and eight grandchildren, with one more on the way.
Oster’s influence is sure to live on in many ways, most poignantly in the memories of the many family members, faculty, students, and alumni who owe her a debt of gratitude. Judith Chevalier said, “Sharon could always be relied upon for the best advice. Anything—something having to do with my kids, a referee, some sticky situation with the university. Recently a colleague from another school cited some excellent advice I had given him years ago that he found very important. I had to chuckle because it was just advice from Sharon that I had recycled and given to him.”
Oster’s name will also live on in one especially fitting way. In 2018, a group of Yale College and Yale SOM alumni, faculty colleagues, and other supporters made it possible for the school to create an endowed chair in economics in her honor—the Sharon Oster Professorship.
Former Yale President Richard Levin said at the time, “This permanent recognition ensures that Sharon’s accomplishments—as a legendary teacher and colleague, and as the first woman to serve as our dean—will never be forgotten. For generations of future students and scholars, the Sharon Oster Professorship will be—as Sharon herself has been for us—an inspiration.”
In lieu of flowers, Oster’s family asks that you please consider a donation to Achievement First. Sharon Oster cared deeply about education and not only dedicated her career to teaching but was also passionate about providing high-quality educational opportunities to everyone, regardless of means.