World Economy

Potential Winners of Nobel Prize in Economics

Potential Winners of Nobel Prize in EconomicsPotential Winners of Nobel Prize in Economics

The Royal Swedish Academy of Sciences names its choice for the Nobel Prize in economics Monday. Forecasting who might win isn’t very scientific. Nominees for the awards—past or present—remain a very tightly guarded secret, which leaves Nobel odds makers, if such a thing exists, to rely mostly on good guesswork, WSJ reported.

Thomson Reuters maintains a running list of possible winners, to which it adds a few names every year. They tabulate frontrunners based on the number of research citations those academics receive, and this year they added to the list Sir Richard Blundell of University College London for his work on labor markets and consumer demand, including how economic downturns shape families. Mr. Blundell also won an online poll conducted by Thomson Reuters.

The news and data firm’s other potential frontrunners include John List of theUniversity of Chicago for his work developing field experiments to test economic theories and Charles Manski of Northwestern University for his work on rational choice theory and social policy analysis.

Most Nobel predictions tend to start with the same group of names, grouping would-be laureates by subject-matter expertise and then favoring some candidates because their research hits a vein of current discussion—say, the environment or financial crises—or discounting others because recent winners have come from their same subcategory of expertise. Perennial favorites have included Paul Romer of New York University and Robert Barro of Harvard University for their work on growth theory.          

Sir Anthony Atkinson of Oxford University and Angus Deaton of Princeton University have been tabbed in the past as frontrunners if the prize committee decides to recognize research on income inequality.

If the committee decides to recognize research in the field of econometrics, Oxford’s Sir David Hendry, Hashem Pesaran of the University of Southern California, and Peter C.B. Phillips of Yale University are often mentioned.

On environmental economics and climate change, frequently mentioned candidates include Harvard’s Martin Weitzman and Yale’s William Nordhaus. Other environmental economists that could get the honor include Cambridge University’s Sir Partha Dasgupta.

On monetary policy, the committee might look at research on how central banks can promote growth when short-term rates have been cut to zero—a timely topic if there ever was one—with a shortlist that includes Columbia University’s Michael Woodford, former Federal Reserve Chairman Ben Bernanke and former Swedish central bankerLars Svensson. A related possibility: The award goes to some combination of these academics with Stanford’s John Taylor, a favorite because he developed a rule that stipulates how central banks should set nominal rates.

NYU’s William Baumol is frequently mentioned for his work on health spending, entrepreneurship and environmental economics.

The economics prize committee spends nearly one year gathering nominations before submitting recommendations in September to members of the academy, who then vote in early October. A majority vote decides the winner or winners and the decision is final. The laureates are notified by phone on Monday morning from Sweden and the award is announced at 1 p.m. local time, or 8 a.m. in the Eastern US.