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Nobel Prize For Economics Awarded To Two Americans
BBC NEWS, BUSINESS
October 10, 2011: American academics Thomas Sargent and Christopher Sims have won the 2011 Nobel economics prize. The Royal Swedish Academy of Sciences cited "their empirical research on cause and effect in the macroeconomy". They had studied how economic policy such as raising interest rates or cutting taxes affects macroeconomic variables such as GDP and inflation.
The award's official name is the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.
Thomas Sargent, 68, is a professor of economics at New York University. The academy pointed to his work examining the post-World War II era, when many countries initially tended to implement a high-inflation policy, but eventually introduced systematic changes in economic policy and reverted to a lower inflation rate.
Christopher Sims, also 68, is a professor of economics and banking at Princeton University. The academy said he had developed a method based on "vector autoregression" to analyze how the economy is affected by temporary changes in economic policy and other factors, for instance, the effects of an increase in the interest rate set by a central bank.
Peter Diamond, Dale Mortensen and Christopher Pissarides won the 2010 prize for their work on how regulation and policy affects jobs and wages.
