Trio wins Economics Nobel Prize for explaining 'innovation-driven economic growth'
What's the story
The 2025 Nobel Memorial Prize in Economic Sciences has been awarded to Joel Mokyr, Philippe Aghion, and Peter Howitt. The trio was honored for their work in explaining innovation-driven economic growth. According to a statement from the Nobel committee, Mokyr received half of the prize for identifying prerequisites for sustained growth through technological progress. Meanwhile, the other half of the prize was jointly awarded to Aghion and Howitt for their theory of sustained growth through creative destruction.
Historical insights
Mokyr's work on historical understanding of growth
Mokyr used historical sources to understand why sustained growth has become the new normal. He argued that for innovations to succeed one another in a self-generating process, scientific explanations are needed. This was often lacking before the industrial revolution, making it hard to build on new discoveries and inventions. He also stressed the need for society to be open to new ideas and change.
Economic model
Aghion and Howitt's joint work on 'creative destruction'
In a 1992 paper, Aghion and Howitt created a mathematical model to explain how new and better products can lead to older ones being pushed out of market. This process is termed "creative destruction," as it involves both creativity in innovation and destruction in obsolescence.
Prize history
History of the Economics Nobel Prize
The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel was established by Sweden's central bank in 1968. It was created to honor Alfred Nobel, the Swedish businessman and chemist who invented dynamite and founded the five original Nobel Prizes. The Economics prize is handed over on December 10, the anniversary of Nobel's death. Since its inception, it has been awarded 56 times to a total of 96 people.
List
A look at the other prizes
This year, the winners of the Physics Nobel Prize were John Clarke, Michel H Devoret, and John M Martinis. The winners of the Chemistry Nobel Prize were Susumu Kitagawa, Richard Robson, and Omar M Yaghi. Mary E Brunkow, Fred Ramsdell, and Shimon Sakaguchi won the Nobel Prize in Medicine. Hungarian author László Krasznahorkai won the Nobel Prize in Literature. Finally, Venezuelan politician Maria Corina Machado was awarded the Nobel Peace Prize.