Nobel Prize in Economics Honors Research on Innovation and Economic Growth
Stockholm, Sweden – The Nobel Prize in Economic Sciences has been awarded to Joel Mokyr, Philippe Aghion, and Peter Howitt for their groundbreaking research explaining how innovation fuels long-term economic growth, a process known as “creative destruction.” The Royal Swedish Academy of Sciences announced the winners Monday, recognizing their contributions to understanding the forces behind sustained prosperity.
The laureates’ work illuminates the mechanisms driving innovation - the constant replacement of old technologies and businesses with new,more efficient ones - and why fostering this process is crucial to avoiding economic stagnation. The concept of “creative destruction” was popularized by economist Joseph Schumpeter in his 1942 book, “Capitalism, Socialism and Democracy,” but this year’s winners have provided deeper insights into how it happens and why it matters.
Mokyr was recognized for demonstrating that scientific explanations – understanding why an innovation works – are as vital as simply knowing that it works for driving a self-sustaining process of innovation. Aghion and Howitt, meanwhile, developed a mathematical model in a 1992 paper that outlines the mechanisms behind sustained economic growth through creative destruction.
Aghion’s work extends beyond academia; he contributed to the economic program of French President Emmanuel Macron during his 2017 election campaign and recently co-chaired the Artificial Intelligence Commission, presenting Macron with a report containing 25 recommendations to establish France as a leader in AI in 2024.
“The work of the laureates demonstrates that economic growth cannot be taken for granted. We must defend the mechanisms underlying creative destruction to avoid stagnation,” stated John Hassler, chair of the economic sciences prize committee.
The prize, worth 11 million Swedish crowns, will be split, with half awarded to Mokyr and the remaining half shared between Aghion and howitt. Along with the monetary award, the winners will receive an 18-karat gold medal and a diploma.
