August 1, 2021

Americans Nordhaus and Romer, Nobel Prize in Economics for their study of the impact of climate change

Americans Nordhaus and Romer, Nobel Prize in Economics for their study of the impact of climate change



The Central Bank of Sweden announced on Monday the awarding of the Nobel Prize in Economics to the American economists William D. Nordhaus and Paul M. Romer. The body, responsible for the awarding of this award, has chosen its work on the impact of climate change and technology on macroeconomic indicators.

The Swedish Academy has highlighted the contribution of William Nordhaus to the integration of climate change into economic analysis, while in the case of Paul Romer its role in the integration of technological innovations in the analysis of the economy has been underlined.

Romer was chief economist at the World Bank, a position he resigned from this year. He has been known as a critic of economic models and neoliberal policies. For its part, Nordhaus has been the author of numerous publications in which the model of economic growth that does not take into account environmental policies is questioned. He has been an advocate for increasing policies to reduce the ecological footprint.

Both "have designed methods that address some of the most fundamental and urgent issues of our time: long-term sustainable growth in the global economy and the well-being of the population."

Nordhaus, said the Academy, shows in its research how economic activity interacts with basic chemistry and physics to cause climate change. He was "the first person to create a quantitative model that describes the interaction between economics and climate," added the Academy.

Nordhaus's work also shows that the most effective way to combat the consequences of the problems caused by climate change "is a global plan for carbon taxes in all countries." He has defended the implementation of a global tax on emissions applied in all countries to reduce pollution.

As for Romer, his research shows that "the accumulation of ideas supports long-term economic growth, demonstrating how economic forces are behind the will of companies to generate new ideas and innovations." The Academy stressed that Romer laid the foundations of what is known as "the theory of endogenous growth," which "has generated a lot of new research in regulations and policies that foster new ideas and long-term prosperity."

The Spanish economist Manuel Arellano was among the main pools to obtain this award. He would have been the first Spaniard in history to receive this recognition. Economics is, along with Physics, the only Nobel that has never won a Spanish or a Latin American.

The Nobel of Economy, whose real name is Prize of Economic Sciences in memory of Alfred Nobel, is the unique one of the six awards not created in his day by the Swedish magnate, but that was instituted in 1968 from a donation to the Foundation Nobel of the National Bank of Sweden on the occasion of its 300th anniversary.

The prize has been awarded 49 times by the Royal Swedish Academy of Sciences to 79 people, but only one woman has won it, the American Elinor Ostrom, who shared it in 2009 with Oliver Williamson for his analyzes on economic policy of common properties .

Every year the Nobel Committee of Economics sends confidential letters to competent persons in the area as members of the Royal Academy of Sciences, former winners of the prize or Economics professors of Nordic universities.

The winner or winners will receive the 9 million Swedish crowns (970,000 euros) that this year are awarded the Nobel, which are delivered on December 10 in a double ceremony in Oslo, for Peace, and Stockholm, for the rest .

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