Acemoglu, Johnson, and Robinson win 2024 Nobel Economics Prize
The 2024 Nobel Prize in Economics has been awarded to Daron Acemoglu, Simon Johnson, and James A. Robinson. The trio was recognized "for studies of how institutions are formed and affect prosperity," according to the official announcement. Their groundbreaking research has significantly contributed to understanding the formation and evolution of political institutions, as well as their impact on societal wealth.
Their model explained formation, change of political institutions
The laureates' model for explaining how political institutions are formed and changed has three components. The first component is a conflict over resource allocation and decision-making power in a society, usually between the elite and the masses. The second component proposes that the masses get opportunities from time to time to challenge the ruling elite, by mobilizing and threatening their authority.
The 3rd component of their model
The third part of the laureates' model tackles the commitment problem, meaning that the only option left for the elite is to give up decision-making power to the people. This novel approach has offered important insights into societal dynamics and power structures.
Research highlights disparities in national prosperity
Acemoglu, Johnson, and Robinson's research has underscored stark differences in prosperity across nations. They have largely attributed these differences to differences in societal institutions. By studying the political and economic systems set up by European colonizers, they have shown the connection between institutions and prosperity. Their work also provides theoretical frameworks explaining why these institutional differences persist and how they can change over time.
A brief history of the Nobel Economics prize
The Nobel Economics Prize, or the 'Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel' as it is officially known, was created by Sweden's central bank in honor of Alfred Nobel. The first laureates were Ragnar Frisch and Jan Tinbergen in 1969. Although not a technical Nobel Prize, it is conventionally awarded with other categories on December 10, the anniversary of Alfred Nobel's death in 1896.
