One year ago tomorrow, French economist Jean Tirole was being plucked from relative obscurity at the Toulouse School of Economics to receive the Sveriges Riksbank Prize in Economic Sciences.
Tirole was widely hailed as a solid choice, having spent years researching how governments and regulators should handle mergers, cartels and monopoly industries.
Hollywood may never make a film about him, but Tirole’s theories are highly pertinent in an era of tech innovation and disruption. He’s right up there with the most cited economists:
With two hours to go until the big announcement, here’s a scene-setter from Agence France-Presse:
The 2015 Nobel season wraps up Monday with the announcement of the winner of the economics prize, which could go to research into the job market or consumer behaviour, though no obvious frontrunner stands out.
The prize is to be announced on Monday at 1:00 pm (1100 GMT) by the Royal Swedish Academy of Sciences in Stockholm, and will mark the close of a season that has seen the literature prize go to Belarussian writer Svetlana Alexievich and the peace prize awarded to Tunisia’s National Dialogue Quartet, four civil society groups that helped rescue the only democracy to emerge from the Arab Spring.
The economics prize – the only one of the six awards not created in Swedish philanthropist and scientist Alfred Nobel’s 1895 will, instead founded by the Swedish central bank in his memory in 1968 – has been controversial since its inception, with some seeing it as veering too close to politics.
Unlike the medicine, physics, and chemistry prizes, all announced last week, “economics is not an experimental science,” Peter Englund, the former head of the Economic Sciences Prize Committee, wrote on the Nobel Foundation’s website.
And each year, critics note that Alfred Nobel never intended to reward economists.
Members of the public often point out that economists have been unreliable in predicting financial crises and economic downturns, and that so far a remedy against mass unemployment remains elusive.
Updated at 10.01am BST
If the Royal Swedish Academy of Sciences really want to get some attention, they could garland Greece’s former finance minister…..
(maybe Yanis could share it with Wolfgang Schäuble…..)
Updated at 9.51am BST
Watch the announcement here:
Today’s announcement will be streamed live from Stockholm in a couple of hours.
Here’s a web feed (which I’ve tried to embed at the top of this blog too).
The Bernanke bandwagon is building up speed….
The Wall Street Journal has thrown a handful of potential contenders into the mix, a reminder that economics is a broad church:
Perennial favorites have included Paul Romer of New York University and Robert Barro of Harvard University for their work on growth theory.
Sir Anthony Atkinson of Oxford University and Angus Deaton of Princeton University have been tabbed in the past as frontrunners if the prize committee decides to recognize research on income inequality.
If the committee decides to recognize research in the field of econometrics, Oxford’s Sir David Hendry, Hashem Pesaran of the University of Southern California, and Peter C.B. Phillips of Yale University are often mentioned.
On environmental economics and climate change, frequently mentioned candidates include Harvard’s Martin Weitzman and Yale’s William Nordhaus. Other environmental economists that could get the honor include Cambridge University’s Sir Partha Dasgupta.
The Nobel Prize team have produced some handy facts to tide us over until the announcement at noon — including that only one woman has ever scooped today’s prize:
- 46: Prizes in Economic Sciences have been awarded since 1969.
- 23: Prizes in Economic Sciences have been awarded to one Laureate only.
- 1: woman have been awarded the Prize in Economic Sciences so far,Elinor Ostrom, in 2009.
- 51: years was the age of the youngest Laureate in Economic Sciences ever, Kenneth J. Arrow, who was awarded in 1972.
- 90: years was Leonid Hurwicz when he was awarded the Prize – the oldest Laureate in Economic Sciences ever.
- 67: is the average age of the Laureates in Economic Sciences the year they were awarded the prize.
Maybe we need a Nobel Prize for pedantry too….
Updated at 9.16am BST
Writing in the Guardian today, anthropologist and bank observer Joris Luyendijk argues that the Nobel economics prize is a thoroughly bad thing.
Joris reckons that treating economics like a physical science, ruled by fundamental laws which can be derived from data, leads to overconfidence, complacency, excess, and ultimately financial disaster.
He wants the profession put in its place, with the other social sciences which measure how humans interact.
Here’s his conclusion:
A revamped social science Nobel prize could play a similar role, feeding the global conversation with new discoveries and insights from across the social sciences, while always emphasising the need for humility in treating knowledge by humans about humans.
One good candidate would be the sociologist Zygmunt Bauman, whose writing on the “liquid modernity” of post-utopian capitalism deserves the largest audience possible. Richard Sennett and his work on the “corrosion of character” among workers in today’s economies would be another.
Will economists volunteer to share their prestigious prize out of their own accord? Their own mainstream economic assumptions about human selfishness suggest they will not.
Could it be Bernanke or Blanchard?
Two economists who have served in the front line of the financial crisis are both in the mix for this years’s award.
This year the jury may choose to honour someone who has combined a research career with the harsh reality of the financial crisis: France’s Olivier Blanchard, who stepped down as chief economist of the International Monetary Fund this month, or Ben Bernanke, the former chairman of the US Federal Reserve.
Still, the favourites are a host of decidedly more low-key professors at US universities such as Indian-born Avinash Dixit of Princeton, American economist Robert Barro of Harvard and Finland’s Bengt Holmstrom at MIT.
Blanchard would be a controversial choice, given the IMF’s role in the Greek debt crisis where it underestimated the impact of harsh cutbacks on economic growth.
But the timing couldn’t be better for Bernanke, who has a new book to plug.
Updated at 9.01am BST
Britain’s Richard Blundell is in the running
Today’s award may go to a British economist, Sir Richard Blundell, for his research into consumer behaviour, labour markets, and the impact of economic downturns on families.
Blundell already has a fairly glittering CV for his work in econometrics (using mathematical and statistical techniques on economic data to test theories and make predictions).
This includes research into how tax credits encourage people into work and lower poverty (he gave the Adam Smith Lecture on this subject in 2005) — and the impact on family spending when wages contract.
These are important issues in this time of austerity (especially with the UK government cutting back on tax credits).
My colleague Phillip Inman explains:
A British economist who made his name studying wages, taxes and household spending is among the frontrunners to win the economics Nobel prize when it is announced on Monday.
Analysis by Thomson Reuters found that Sir Richard Blundell, the Ricardo professor of political economy at University College London, was cited in more academic papers over the last year than any other economist, indicating that his research on the impact of falling wages on consumer demand has proved hugely influential.
Updated at 8.48am BST
Introduction: Nobel prize for economics awarded today
It’s time for the final act in this year’s Nobel season: the award of the 2014 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.
Over in Stockholm, Sweden, the Royal Swedish Academy of Sciences are preparing to announce the winner of the most prestigious award in economics.
This prize is also quite contentious. For a start, it’s not one of the original ones created by Nobel himself, with the wealth accrued from a career developing explosives. Instead, it was created in 1969 to mark the 300th anniversary of Sweden’s central bank.
Ever since, people have been arguing about whether economics is a ‘proper science’ at all, ranked alongside physics, chemistry and medicine (let alone literature or peace).
Other social sciences don’t get the same star treatment, and they didn’t fail to stop the greatest financial crash in generations.
But still, the award has recognised some serious work over the decades, across the economic sphere.
For example, US mathematics genius John Nash was recognised by the Academy in 1994 for his work on game theory. James Tobin, who promoted the idea of a transaction tax to curb financial excess, was honoured in 1981.
This prize is notoriously difficult to call, but there are some interesting names in the mix this year including a couple of Brits (more on that shortly….)
The award is made at 1pm in Stockholm, which is noon in the UK. That’s only 4am on the West Coast of the US, which could be problematic if the award goes to a Californian…..
Updated at 8.28am BST