WASHINGTON — Washington. -- George Stigler won the Nobel Prize for economics, but few Americans knew of him last week when he died, full of years (80 of them) and honors. What should have pleased him most was this fact: The Cold War is over and the University of Chicago won it.
Stigler exemplified the ''Chicago school'' of economics, named for the university where he taught with Milton Friedman (another Nobel laureate), Friedrich von Hayek (another), Frank Knight (who should have been one) and Ronald Coase (this year's winner). Economics shares a long, open border with politics, and hence with philosophy. Stigler always knew, as the world now does, the serious stakes of the intellectual defense of markets.
However, he may have been the wittiest serious man since Gibbon. Hence the irresistible appeal of his writings to young intellectuals chafing, in the 1960s, under the statist orthodoxies in universities.
In 1962 Oxford, ''home of lost causes,'' was home for a few partisans of what then seemed to be another such cause, the moral defense of capitalism. We were American graduate students enthusiastic about Friedman's ''Capitalism and Freedom'' and Stigler's essays in praise of laissez-faire policies.
Like most young intellectuals, we were given to going too far, debating whether government, which obviously should privatize schools, courts and roads, must operate lighthouses. Moderates said: Yes, regrettably it must because you cannot price lighthouses' services. Purists rejoined: Rubbish! When light sweeps the water's surface, the lighthouse operator is (in Locke's words) mixing his labor with the water, improving it and making it his property, so he can charge ships whatever the market will bear for the right to pass through it.
Ah, but did the property right lapse when fog blocked the improving light? And so on, and on.
Such intellectual playfulness was part of the genesis of the conservative ideas which, when much matured, produced Ronald Reagan and Margaret Thatcher, and market economies amid the rubble of Marxism. The core ideas were given mature expression by Stigler in essays accessible to lay readers.
In 1963 Stigler published ''The Intellectual and the Market Place and Other Essays'' (foreword by the dean of the Chicago Business School -- George Shultz). The subject of the title essay was the revulsion intellectuals express toward economies organized around the self-interested search for profits in the marketplace. That place, say many intellectuals, is for vulgar people with base motives.
Acknowledging that he, too, was an intellectual (buying ''more books than golf clubs''), Stigler noted that ''we professors are more beholden to Henry Ford than to the foundation which bears his name and spreads his assets.'' Ford contributed mightily to mass production. Intellectuals are expensive to maintain. Professors need universities at which to profess. Universities need endowments and tax support. So a large social surplus, the product of private-enterprise economies, is a prerequisite for a large, comfortable (although constantly complaining) intelligentsia.
Intellectuals' disparagement of the system that supports them is ostensibly moral but actually as much aesthetic. It is that the ''profit motive'' ratifies ''materialism.'' And because economic illiteracy is especially high among intellectuals, many of them consider commerce comparable to poker, a zero-sum transaction where one person's gain must be another's loss.
In response Stigler said, ''Sears, Roebuck and Company, and Montgomery Ward made a good deal of money in the process of improving our rural marketing structure, but I am convinced that they did more for the poor farmers of America than the sum total of the federal agricultural support programs of the last 28 years.''
It was, he wrote, the industriousness of self-interested profit-seekers in the marketplace that was doubling America's per-capita wealth every 25 years. The fact that wealth creation has slowed since Stigler wrote that testifies to two phenomena which Stigler understood.
One is the intellectuals' disdain for wealth-creators, disdain that produces ignorant or punitive public policies. Another is the economic illiteracy that causes intellectuals and their public-sector echoes to consider wealth creation easy, even spontaneous.
Stigler said his essay, written to encourage intellectuals to re-examine their hostility toward capitalism, had been ''more successful in reaffirming businessmen in their faith. This is not an undesirable effect, but a lecturer denouncing cannibalism naturally must view the applause of vegetarians as equivocal evidence of his eloquence.''
Regarding the intellectuals' contempt for the vulgarity of market choices, Stigler, his whimsy sheathing a stiletto, said, ''When a good comedian and a production of Hamlet are on rival channels, I wish I could be confident that less than half the professors were laughing.'' Stigler's death subtracts from society's supply of two scarce commodities, wisdom and laughter.
George F. Will is a syndicated columnist.