Trio Wins 2025 Economics Nobel For Work On Innovation And Growth

STOCKHOLM- The Americans have done it again. The final Nobel of this year’s prize season — the Nobel Memorial Prize in Economic Sciences — went on October 13 to Joel Mokyr of Northwestern University and Peter Howitt of Brown University, both from the United States, and Philippe Aghion of the Collège de France and INSEAD in Paris, France. The trio was recognized for their work explaining how innovation fuels sustained economic growth.

According to the Royal Swedish Academy of Sciences, one half of the prize went to Mokyr “for having identified the prerequisites for sustained growth through technological progress,” while the other half was jointly awarded to Aghion and Howitt “for the theory of sustained growth through creative destruction.”

“Over the last two centuries, for the first time in history, the world has seen sustained economic growth. This has lifted vast numbers of people out of poverty and laid the foundation of our prosperity. This year’s laureates explain how innovation provides the impetus for further progress,” the Academy said in its citation.

Mokyr’s historical research traced the roots of innovation-driven growth, showing that for technological advances to continuously build on one another, societies must understand not only that something works but also why it works. Before the Industrial Revolution, such scientific understanding was often absent, limiting progress. Mokyr also emphasized the role of societies open to new ideas and change.

Aghion and Howitt, meanwhile, developed a model of “creative destruction” — the process by which new innovations render old technologies obsolete. Their 1992 paper described how progress comes from this churn: new products create growth even as outdated ones and the firms behind them are swept aside.

The laureates, the Academy said, demonstrate that creative destruction must be managed constructively. “Otherwise, innovation will be blocked by established companies and interest groups that risk being put at a disadvantage,” said John Hassler, Chair of the Prize Committee. “Economic growth cannot be taken for granted. We must uphold the mechanisms that underlie creative destruction, so that we do not fall back into stagnation.” (IANS)