The 2018 Nobel Memorial Prize in Economics has been awarded to William Nordhaus and Paul Romer for their work on sustainable growth.
Nordhaus and Romer who are both US economists’ research focuses on how climate change and technology have affected the economy.
According to the Royal Swedish Academy of Sciences they had addressed “some of our time’s most… pressing questions” on how to achieve sustainable growth.
The duo will receive nine million Swedish krona (US$1,000,000).
The academy said that Prof Nordhaus, of Yale University, was the first person to create a model that described the interplay between the economy and the climate.
Prof Romer, of New York University’s Stern School of Business, has shown how economic forces govern the willingness of firms to produce new ideas and innovations.
According to a statement by the academy:
“Their findings have significantly broadened the scope of economic analysis by constructing models that explain how the market economy interacts with nature and knowledge”.
Prof Romer courted controversy earlier this year when he stepped down as the World Bank’s chief economist after just 15 months in the job.
He had claimed that Chile’s rankings in a closely watched “Doing Business” report may have been manipulated for political reasons under socialist president Michelle Bachelet.
It came amid reports that the outspoken economist had clashed with colleagues at the Word Bank over a host of issues, including the organisation’s culture and economists’ use of grammar.
Commenting on the prize, Prof Romer told reporters: “I think… many people think that protecting the environment will be so costly and so hard that they just want to ignore [this].
“[But] we can absolutely make substantial progress protecting the environment and do it without giving up the chance to sustain growth”.