William Nordhaus and why he won the Nobel Prize in economics

These are excellent Nobel Prize selections, Romer for economic growth and Nordhaus for environmental economics.  The two picks are brought together by the emphasis on wealth, the true nature of wealth, and how nations and societies fare at the macro level.  These are two highly relevant picks.  Think of Romer as having outlined the logic behind how ideas leverage productivity into ongoing spurts of growth, as for instance we have seen in Silicon Valley.  Think of Nordhaus as explaining how economic growth interacts with the value of the environment.  Here is their language:

2018 Sveriges Riksbank Prize in Economic Sciences is awarded jointly to William D Nordhaus “for integrating climate change into long-run macroeconomic analysis” and Paul M Romer “for integrating technological innovations into long-run macroeconomic analysis”.

Both are Americans, and both have highly innovative but also “within the mainstream” approaches.  So this is a macro prize, but not for cycles, rather for growth and long-term economic prospects.  Here is the Prize committee citation, always well done.

Both candidates were considered heavy favorites to win the Prize, sooner or later, and these selections cannot come as a surprise.  Perhaps it is slightly surprising that they won the Prize together, though the basic logic of such a combination makes good sense.  Here are previous MR mentions of Nordhaus, you can see we have been mentioning him for years in connection with the Prize.

Here is the home page of Nordhaus.  Here is Wikipedia.  Here is scholar.google.com.  Here is Joshua Gans on Nordhaus.

Nordhaus is professor at Yale, and most of

Keep reading this article on Marginal Revolution.

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