Nobel Prize in Economics for US economists Hall and Woodford

This year's Nobel Prize in Economic Sciences goes to Robert E. Hall and Michael Woodford from the USA. This was announced by the Royal Swedish Academy of Sciences in Stockholm.

Woodford and Hall receive the award for the development of macroeconomic models that enable more effective stabilization policies. Based on their models, well-coordinated fiscal and monetary policy measures could mitigate upward and downward economic swings, said the Academy's Secretary General, Ellen Moons, at the award announcement.

Basis for governments and central banks

The award winners have provided a "solid theoretical basis" for the models that are now used by governments and central banks around the world, said the chairman of the responsible committee, John Hassler. "With them, we are better equipped to deal with economic shocks such as energy crises or sudden changes in household consumption patterns."

Hall teaches at Stanford University in California. Woodford teaches at Columbia University in New York.

In an initial reaction, Woodford called the award a tremendous honor. "It's a big surprise, but it feels very good," he said, speaking by phone from New York to make the announcement.

Awarded only since 1969

The Nobel Prize in Economics has only been awarded since 1969. It is the only prize that does not go back to the will of the Swedish industrialist and dynamite inventor Alfred Nobel. The prize is sponsored by the Swedish central bank, which is why the Nobel Foundation does not officially call it the Nobel Prize, but rather the "Swedish Riksbank Prize for Economic Sciences in Memory of Alfred Nobel".

This year, like the other awards, the prize is endowed with twelve million Swedish crowns - that's just over one million euros. It will also be awarded in Stockholm on December 10th, the anniversary of Nobel's death.