Finally!

The economic prize.

The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (aka the Econ Nobel) was awarded today, the last of the year’s prizes to be announced.

This year it went to two econometricians, Christopher Sims and Thomas Sargent, which is especially interesting to me since I’m making my first delving into econometrics this semester. (Okay, I’m kinda drowning, actually. Statistics are not my strong suit.)

The Nobel prize page says they won “for their empirical research on cause and effect in the macroeconomy”.

Paul Krugman explains further:

“…before Sargent and Sims came along, econometrics consisted largely of estimating models you had no good reason to believe based on identifying assumptions (if you don’t already know, you don’t want to) that lacked credibility. S and S played a key role in developing methods that let the data speak instead.

The things that I am studying right now were developed by people who are still teaching. Much of economics is still being written (like the brand new field of behavioral economics, pioneered by Freakonomics author Steven Levitt), which I find so amazing. I wish I had the opportunity to take classes from all these great minds.

Congratulations to Dr. Sims and Dr. Sargent!

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