Nobel memorial prize in economics

Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel
Awarded for Outstanding contributions in Economic Sciences
Location Stockholm, Sweden
Presented by Royal Swedish Academy of Sciences
First awarded 1969
Official website http://nobelprize.org

The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (Swedish: Sveriges riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), commonly referred to as the Nobel Prize in Economics,[1][2] is an award for outstanding contributions to the field of economics, generally regarded as the most prestigious award for that field.[3] Although not one of the Nobel Prizes established by the will of Alfred Nobel in 1895, it is identified with them, and prizes are announced with and awarded at the same ceremony.[3]

The Prize in Economics, as it is referred to by the Nobel Foundation, was established and endowed by Sweden's central bank Sveriges Riksbank, in 1968 on the occasion of the bank's 300th anniversary, in memory of Alfred Nobel.[3][4][5][6]

Like the Nobel Laureates in Chemistry and Physics, Laureates in Economics are selected by the Royal Swedish Academy of Sciences, and a Prize Committee similar to the Nobel Committees is used.[7][8]

It was first awarded in 1969 to the Dutch and Norwegian economists Jan Tinbergen and Ragnar Frisch, "for having developed and applied dynamic models for the analysis of economic processes."[6][9][10]

Funding of the Prize

An endowment "in perpetuity" from Sveriges Riksbank pays the Nobel Foundation's administrative expenses associated with the prize and funds the monetary component of the award.[7]

Since 2001, the monetary portion of the Prize in Economics has totalled 10 million Swedish kronor (during January 2008, approx. US$1.6 million; 1.1 million Euro). This is equivalent to the amount given for the original Nobel Prizes.[11][12][13] Since 2006, Sveriges Riksbank has given the Nobel Foundation an annual grant of 6.5 million Swedish kronor (in January 2008, approx. US$1 million; 0.7 million Euro) for its administrative expenses associated with the prize as well as 1 million Swedish kronor (until the end of 2008) to include information about the prize in the Nobel Foundation's internet webpage.[14]

Relation to the Nobel Prizes

The Prize in Economics is not one of the original Nobel Prizes created by the will of Alfred Nobel.[3][15][16] However, the nomination process, selection criteria, and awards presentation of the Prize in Economic Sciences are performed in a manner similar to that of the Nobel Prizes.[7][12][17] The Prize is awarded by the Royal Swedish Academy of Sciences "in accordance with the rules governing the award of the Nobel Prizes instituted through his [Alfred Nobel's] will",[7] which stipulates that the prize be awarded annually to "those who ... shall have conferred the greatest benefit on mankind".[18]

Award nomination and selection process


According to its official website, the Royal Swedish Academy of Sciences "administers a researcher exchange with academies in other countries and publishes six scientific journals. Every year the Academy awards the Nobel Prizes in Physics and Chemistry, the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel, the Crafoord Prize and a number of other large prizes".[8]

Each September the Academy's Economics Prize Committee, which consists of five elected members, "sends invitations to thousands of scientists, members of academies and university professors in numerous countries, asking them to nominate candidates for the Prize in Economics for the coming year. Members of the Academy and former laureates are also authorised to nominate candidates."[7][8][19] All proposals and their supporting evidence must be received before February 1.[16] The proposals are reviewed by the Prize Committee and specially appointed experts. Before the end of September, the committee chooses potential laureates. If there is a tie, the chairman of the committee casts the deciding vote. Next, the potential laureates must be approved by the Royal Swedish Academy of Sciences. Members of the Ninth Class (the social sciences division) of the Academy vote in mid-October to determine the next laureate or laureates of the Prize in Economics.[7][8][20] As with the Nobel Prizes, no more than three people can share the prize for a given year; they must still be living at the time of the Prize announcement in October; and information about Prize nominations cannot be disclosed publicly for 50 years.[16]

Like the Nobel Laureates in Physics, Chemistry, Physiology or Medicine, and Literature, each Laureate in Economics receives a diploma, gold medal, and monetary grant award document from the King of Sweden at the annual Nobel Prize Award Ceremony in Stockholm, on the anniversary of Nobel's death (December 10).[3][21]

Changes to the prize

Sylvia Nasar wrote in her book A Beautiful Mind that in February 1995, after acrimony pertaining to the awarding of the 1994 Prize in Economics to John Forbes Nash, the Prize in Economics was redefined as a prize in social science. This makes it available to researchers in such topics as political science, psychology, and sociology.[22][23] Moreover, the composition of the Economics Prize Committee changed to include two non-economists. This has not been confirmed by the Economics Prize Committee. The members of the 2007 Economics Prize Committee contradict Nasar's claim since the secretary and 4 of the 5 members are professors of economics.[24] In 1978, Herbert A. Simon, whose PhD was in political science, became the first non-economist to win the prize, while Daniel Kahneman, a professor of psychology and international relations at Princeton University is the first non-economist by profession to win the prize.

Controversies and criticisms

Some critics argue that the prestige of the Prize in Economics derives in part from its association with the Nobel Prizes, an association that has often been a source of controversy. Among them is the Swedish human rights lawyer Peter Nobel, a great-grandson of Ludvig Nobel.[25] Nobel criticizes the awarding institution of misusing his family's name, and states that no member of the Nobel family has ever had the intention of establishing a prize in economics.[26]

According to Samuel Brittan of the Financial Times, both former Swedish minister of finance Kjell-Olof Feldt and Gunnar Myrdal wanted the prize abolished, saying "Myrdal rather less graciously wanted the prize abolished because it had been given to such reactionaries as Hayek (and afterwards Milton Friedman)."[23]

In his speech at the 1974 Nobel Banquet Friedrich Hayek stated that if he had been consulted whether to establish a Nobel Prize in economics he would "have decidedly advised against it"[23][27] primarily because "the Nobel Prize confers on an individual an authority which in economics no man ought to possess... This does not matter in the natural sciences. Here the influence exercised by an individual is chiefly an influence on his fellow experts; and they will soon cut him down to size if he exceeds his competence. But the influence of the economist that mainly matters is an influence over laymen: politicians, journalists, civil servants and the public generally."[27]

Critics cite the apparent snub of Joan Robinson as evidence of the Committee's bias towards mainstream economics,[28][29] though heterodox economists like Friedrich Hayek (Austrian School) and Ronald Coase (associated with New institutional economics) have won.

Milton Friedman was awarded the 1976 prize in part for his work on monetarism. Awarding the prize to Friedman caused international protests by the left,[30] Friedman was accused of supporting the military dictatorship in Chile, because of the relation of economists of the University of Chicago to Pinochet and a controversial six-day trip[31] he took to Chile during March 1975 (less than two years after the coup which deposed the democratically elected president Salvador Allende). Friedman himself answered, that he never was an adviser of the dictatorship, only gave some lectures and seminars on inflation and met with many officials including the dictator Augusto Pinochet in Chile.[32]

Four Nobel Prize laureates – George Wald, Linus Pauling, David Baltimore and Salvador Luria – wrote letters to the New York Times protesting the award to Friedman in October 1976.[33][34]

The 1994 prize to John Forbes Nash caused controversy within the prize's selection committee because of his history of mental illness and alleged anti-Semitism.[35] The controversy resulted in a change to the rules governing the committee during 1994. Previously, members of the Economics Prize Committee members did not have any limit to their term of service; they now serve for three years.[22]

The 2005 prize to Robert Aumann was criticized by European press due to his alleged use of his research of game theory to justify his stance against the dismantling of Israeli settlements from occupied territories.[36]

Alternative names

The official Swedish name of the Prize is Sveriges riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne. The Nobel Foundation's translations of the Swedish name into English have varied since 1969:

Years Official name in English
1969–1970 Prize in Economic Science dedicated to the memory of Alfred Nobel[37][38]
1971 Prize in Economic Science[39]
1972 Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel[40]
1973–1975 Prize in Economic Science in Memory of Alfred Nobel[41][42]
1976–1977 Prize in Economic Sciences in Memory of Alfred Nobel[43][44]
1978–1981 Alfred Nobel Memorial Prize in Economic Sciences[45][46]
1982 Alfred Nobel Memorial Prize in Economic Science[47]
1983 Prize in Economic Sciences in Memory of Alfred Nobel[48]
1984–1990 Alfred Nobel Memorial Prize in Economic Sciences[49][50]
1991 Sveriges Riksbank (Bank of Sweden) Prize in Economic Sciences in Memory of Alfred Nobel[51]
1992–2005 Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel[52][53]
2006–present The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel[54][55]

Laureates

Main article: List of Nobel laureates in Economics

The first prize in economics was awarded in 1969 to Ragnar Frisch and Jan Tinbergen "for having developed and applied dynamic models for the analysis of economic processes".[56] Until 2009, all laureates in economics had been men. In 2009, Elinor Ostrom became the first woman to be awarded the prize. All five Nobel Prizes had previously been awarded at some time to a woman.

As of 2008, about 85% of laureates have been US citizens (by birth or by naturalisation), with only five laureates being from outside North America or Western Europe (Arthur Lewis, Robert Aumann, Leonid Kantorovich, Amartya Sen and Christopher A. Pissarides).

See also

Notes

References

External links

  • The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (English version) – Official website of the prize.
  • Royal Swedish Academy of Sciences.
  • Nobel Foundation.
  • IDEAS/RePEc
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