The Nobel Prize in Economics was just announced. It’s gone to Jean Tirole for his analysis of market power and regulation.
He’s the third French economist to be awared the prize, and the first for more than a quarter of a century. He’s also a smidgen younger than the average awardee, at 61 (the usual age is 67).
Here’s a biography from the European Coroporate Governance Institute. Though he’s French, its a win for MIT too: Tirole took his PhD at the university, and has a visiting professorship there.
Here’s the Nobel Committee’s explanation of why they chose Tirole:
“Many industries are dominated by a small number of large firms or a single monopoly. Left unregulated, such markets often produce socially undesirable results — prices higher than those motivated by costs, or unproductive firms that survive by blocking the entry of new and more productive ones.
From the mid-1980s and onwards, Jean Tirole has breathed new life into research on such market failures. His analysis of firms with market power provides a unified theory with a strong bearing on central policy questions: how should the government deal with mergers or cartels, and how should it regulate monopolies?”
Here are the other economies that Reuters thought had the best shot at receiving the award, and who will now have to wait at least one more year:
- William Baumol and Israel Kirzner, for studies on entrepreneurship.
- Philippe Aghion and Peter Howitt, for research on growth theory.
- Mark Granovetter, for his work on economic sociology.
Here’s a live video stream of the announcement:
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