US economists Robert E. Hall and Michael Woodford have been awarded the 2026 Nobel Prize in Economics. The Royal Swedish Academy of Sciences announced on Monday that the two academics will share the prize, formally known as the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. This award was the final prize to be given this year.
The pair were recognized for their decades of work developing economic models that help governments and central banks manage economic shocks. Specifically, they provided insights into the microeconomic foundations of macroeconomic stabilization, creating ground-up models that allow policymakers to be better equipped to deal with fluctuations in the economy.
According to the Royal Swedish Academy of Sciences, these models have helped authorities smooth out the economy's peaks and troughs and respond more effectively to booms and recessions. Their work currently underpins the models used by finance ministries and central banks across the world to implement effective stabilization policy and stabilize the economy.
The economics prize is the only Nobel not among the original five created in the will of Swedish scientist Alfred Nobel, who died in 1896.