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Royal Swedish Academy announces 2025 Nobel Prize in Economics winners
On 13 October 2025, the Royal Swedish Academy of Sciences awarded the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel to Joel Mokyr, Philippe Aghion, and Peter Howitt.
The prize citation states they are honored “for having explained innovation-driven economic growth.” Joel Mokyr receives one half of the prize “for having identified the prerequisites for sustained growth through technological progress”, while Philippe Aghion and Peter Howitt share the other half for their work on “the theory of sustained growth through creative destruction.” The award underscores how technological innovation and the replacement of older methods by newer ones are central to long-term prosperity. The laureates’ theories emphasize that growth isn’t automatic — it depends on institutions and incentives that allow innovation to flourish.
What the Nobel Prize in economics represents
The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, often informally called the “Nobel Prize in Economics,” was established in 1968 by Sweden’s central bank, Sveriges Riksbank, in commemoration of the bank’s 300th anniversary. Although not part of Alfred Nobel’s original set of prizes, it is awarded by the Royal Swedish Academy of Sciences in the same tradition and timing as the other Nobel Prizes.
Recipients are selected for contributions that deepen our understanding of economic processes, institutions, growth, welfare, markets, and policy. The prize amount in 2025 totals 11 million Swedish kronor, with half going to Mokyr and the other half shared by Aghion and Howitt. Through such recognition, the award aims to highlight research that has both theoretical depth and relevance to real-world economic and social challenges.
Why These Economists Were Chosen
Joel Mokyr’s contribution lies in historical analysis: he investigated how, over time, societies came to adopt scientific reasoning and credible explanations, creating the conditions for innovation to build on previous advances. He argued that innovations succeed when societies not only know that something works but also understand why — fostering a cumulative process of technological progress. On the other hand, Philippe Aghion and Peter Howitt developed formal models of creative destruction — the idea that economic growth is sustained when new, better technologies continually replace older ones, pushing the frontier forward.
Their work also highlights that the process involves conflicts (e.g. between incumbents and disruptors) and that institutions must manage these tensions so innovation isn’t blocked. Together, the laureates provide a coherent framework showing that long-run economic growth depends on both technological dynamism and institutional design that allows innovation to thrive.
Recently we wrote that global markets on October 9 balanced between geopolitical shifts, currency interventions, and the threat of an energy deficit.
This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.
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