Nobel Prize in Economics awarded for explaining "innovative growth"
Source: Nobel Committee

The Swedish Central Bank's Alfred Nobel Prize in Economic Sciences in memory of Joel Mokyr of Northwestern University in Illinois, Philippe Aguion of the Collège de France, and Peter Howitt of Brown University have been awarded the 2025 Prize. The decision was announced by the Nobel Committee on Monday.

The award was given with the motivation "to explain economic growth driven by innovation".

Half of the prize will go to Mokyr "for identifying the preconditions for sustainable growth through technological progress," and the other half will be jointly awarded to Agion and Howitt "for creating a theory of sustainable growth through creative destruction.".

"Over the past two centuries, the world has been experiencing sustainable economic development for the first time in history. This has lifted a huge number of people out of poverty and laid the foundations for our prosperity. This year's winners of the Nobel Prize in Economic Sciences explain how innovation is driving further progress," the Nobel Committee explained .

"Joel Mokyr used, among other things, historical sources to find out why sustainable growth has become the new normal. He proved that in order for innovations to succeed each other in a self-sustaining process, it is not enough to know that something works – you also need to have a scientific explanation of why it works. This understanding was often lacking before the Industrial Revolution, making it difficult to use new discoveries and inventions as a foundation for further development. He also emphasized the importance of society's openness to new ideas and readiness for change," the press release reads.

"Philip Agion and Peter Howitt also studied the mechanisms of sustainable growth. In a 1992 article, they built a mathematical model of the so-called creative destruction: when a new and better product enters the market, companies selling older products suffer losses. Innovation is something new and therefore creative. At the same time, it is also destructive, because a company whose technology becomes obsolete loses in the competition," the committee's rationale for this year's decision reads.

Nobel Prize winners in 2025

The Swedish Central Bank's Alfred Nobel Prize in Economic Sciences, awarded for extraordinary achievements in economics, concludes Nobel week. The other prizes went to:

→ Physics: John Clarke, Michel Devore and John Martinis ;
→ Chemistry: Susumu Kitagawa, Richard Robson and Omar Yaggi ;
→ Medicine: Mary Brancow, Fred Ramsdell, and Shimon Sakaguchi ;
→ literature: Laszlo Krasznagorkai ;
→ peace: Maria Corina Machado .

  • In 2024, the winners of the Nobel Prize in Economics were Daron Acemoglu, Simon Johnson and James Robinson "for their research on how institutions are formed and how they affect welfare." Ademoglu and Johnson are the authors of the economic bestseller Why Nations Fail.
GDPinnovationsnobel Prize