Ben S. Bernanke | Douglas W. Diamond | Philip H. Dybvig
“For research on banks and financial crises.”
Their combined discoveries revealed the critical role that banks play in modern society and how banking regulation can help protect the public from a large-scale financial crisis by reducing the damage to individuals and businesses. NSF has invested in the research of both Bernanke and Diamond. Diamond received multiple awards from NSF to investigate the nature of financial crises and how to mitigate them. Bernanke received a Graduate Research Fellowship from NSF in 1975, followed by several awards early in his career in the 1980s and 1990s.
DAVID CARD | JOSHUA D. ANGRIST | GUIDO W. IMBENS
“For empirical contributions to labor economics;” and “for their methodological contributions to the analysis of causal relationships.”
Understanding the complex – and oftentimes counterintuitive – cause and effect relationships between changing aspects of our society and economy is a critical need for policy makers and other leaders. The collective discoveries of Card, Angrist and Imbens, along with contributions by Card's colleague Alan Krueger who died in 2019, showed how cause and effect can be accurately determined when it is not feasible or ethical to conduct a controlled experiment. They used "natural experiments" – large-scale situations arising in real life – to precisely understand how one thing causes another, such as how income affects health, how wages affect unemployment and how investments in schools affect the future earnings of students. Their methods have been widely adopted and applied by researchers studying a range of important social and economic issues. NSF is proud to have supported all three winners and their groundbreaking work.
PAUL MILGROM | ROBERT WILSON
“For improvements to auction theory and inventions of new auction formats.”
The Nobel Assembly has awarded the 2020 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel to Paul Milgrom and Robert Wilson, both of Stanford University. The U.S. National Science Foundation has supported these researchers throughout their efforts to explore game theory and decision-making, and then use that knowledge base to invent new auction formats for multiple, simultaneous transactions. One notable example of their findings applied in the U.S. is the wireless spectrum auctions they helped the Federal Communications Commission create. The auctions have brought in more than $60 billion in federal revenue as of 2020, and enabled innovation from wireless providers.
ABHIJIT BANERJEE | ESTHER DUFLO | MICHAEL KREMER
“For their research in alleviating global poverty.”
The 2019 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel has been awarded to Abhijit Banerjee and Esther Duflo of the Massachusetts Institute of Technology and Michael Kremer of Harvard University for their research in alleviating global poverty. The award committee remarked that the research "has considerably improved our ability to fight global poverty." NSF has supported the work of all three Laureates -- Banerjee with six awards over 20 years, Kremer with six awards over 15 years, and Duflo with four awards over 15 years. Duflo is the youngest person ever to win the economics prize, and the second woman to win.
WILLIAM NORDHAUS | PAUL ROMER
“For expanding the understanding of global scale macroeconomics.”
The Nobel Assembly awarded the 2018 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel to William Nordhaus of Yale University and Paul Romer of New York University for expanding the understanding of global scale macroeconomics. NSF has supported the work of both laureates over multiple decades. Nordhaus integrated key findings from chemistry and physics into macroeconomics, resulting in new methods to understand the interplay between global, atmospheric public goods and economic outcomes. Romer's research highlights the importance of science and technology as long-term drivers of economic growth -- in the U.S. and around the world. His work has helped to identify the specific economic factors that lead firms to invest in innovation, resulting in new findings showing how governments can encourage new ideas.
RICHARD H. THALER
“For his contributions to behavioral economics.”
The 2017 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel has been awarded to Richard H. Thaler of the University of Chicago.
Thaler's research incorporates findings from psychology into the analysis of economic decision-making. Examples include an examination of the impact of
loss aversion on financial decisions (the extreme sensitivity to losses relative to gains) and an investigation of how perceptions of fairness affect
consumers' purchase decisions and limit the ability of firms to change prices. Thaler received NSF support through grants from the Social, Behavioral,
and Economic Sciences Directorate (9223358) to investigate decision-making under risk, launching behavioral economics as a field of basic research.
OLIVER HART | BENGT HOLMSTRÖM
“For their contributions to contract theory.”
The 2016 Sveriges Riksbank Prize in memory of Alfred Nobel was awarded to Oliver Hart and Bengt Holmström "for their contributions to
contract theory." Their research into the economic theory of contracts has led to new theoretical tools for understanding important issues in real-world
contracts, including ownership, property rights, and employee compensation. Hart and Holmström have developed "a comprehensive framework for analyzing
many diverse issues in contractual design, like performance-based pay for top executives, deductibles and co-pays in insurance, and the privatization of
public-sector activities," noted the Royal Swedish Academy of Sciences press release. Hart, the Andrew E. Furer Professor of Economics at Harvard University,
has received multiple NSF awards since the mid-1980s, including award #8520264
and more recently #0922325. Holmström, a long-time professor at the Massachusetts
Institute of Technology (MIT) who holds joint appointments in economics and management, received NSF awards in the 1980s
(#8411732) and 1990s (
"For his analysis of consumption, poverty and welfare."
According to the Royal Swedish Academy of Sciences, which awards the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, "To design
economic policy that promotes welfare and reduces poverty, we must first understand individual consumption choices. More than anyone else, Angus Deaton has
enhanced this understanding." Born in Scotland, Deaton is a professor of international affairs and economics at Princeton University. The work for which he
was honored focuses on three questions: How do consumers distribute their spending among different goods? How much of society's income is spent and how much
is saved? How do we best measure and analyze welfare and poverty? A pair of awards from NSF's Social, Behavioral and Economic Sciences Directorate--one
(#9223668) for "Trying to understand commodity prices" and
another (#9507809) focusing on "Accumulation, Inequality
and Commodity Prices"--supported that work.
“For his analysis of market power and regulation.”
Tirole was awarded the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel for his influential work on regulation and imperfect
markets. A French economist and professor at the Toulouse School of Economics in France, he received his doctorate in economics from the Massachusetts
Institute of Technology in 1981 and taught there for about eight years before returning to France. He holds the title of visiting professor at MIT and
has collaborated with professors at MIT and Harvard University. Tirole was the principal investigator (PI) or co-PI on four awards from NSF beginning
in the mid-1980s: #8520837,
EUGENE F. FAMA | LARS PETER HANSEN | ROBERT J. SHILLER
"For their empirical analysis of asset prices."
The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2013 was awarded jointly to Eugene F. Fama of the University of Chicago,
Lars Peter Hansen of the University of Chicago and Robert J. Shiller of Yale University. Fama has received seven NSF grants, while Hansen has received
nine, from the Social, Behavioral and Economic Sciences directorate, starting in the early 1980s. Shiller has received nine NSF grants since 1979. In
2009, Schiller participated in a NSF webcast on the housing market crisis--which he predicted three years before. Shiller was also selected as a NSF
Graduate Research Fellow in 1967.
ALVIN E. ROTH | LLOYD S. SHAPLEY
“For the theory of stable allocations and the practice of market design.”
Roth and Shapley were jointly awarded the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. Roth, a professor at Harvard University
and later Stanford University, is a long-time NSF awardee. He has received 16 awards since 1978, including two awards for collaborative research on kidney
exchange (#1061932 and #0616733). Roth realized that Shapley's purely theoretical work could help explain how important markets function. Shapley, a professor
emeritus at the University of California at Los Angeles, received multiple NSF awards between 1971 and 1983, for research in game theory--the study of
strategic decision making--and mathematical economics. Shapley and his collaborators developed new methods in cooperative game theory to understand the
properties of stable matching methods. A "stable" match is one where no two agents prefer to swap their current matched partners. Roth built on Shapley's
mathematical formula that predicted that stability would be a key predictor of success of market institutions, and tested this theory in laboratory experiments.
Roth then used the results to develop new methods for allocation. His work is now used to match new doctors to hospitals, to match students to schools and to
match organ donors to patients.
THOMAS J. SARGENT | CHRISTOPHER A. SIMS
“For their empirical research on cause and effect in the macroeconomy.”
Sargent of New York University and Sims of Princeton University are long-time NSF awardees. Sims has received 11 NSF awards since 1976 and Sargent has
received 10 NSF awards since 1985. Sargent's work helps with understanding the linkages between households and businesses--or, those who make decisions today
based on what they expect the economy will look like in the future--and government policy. Sims developed sophisticated data analysis methods that can help
researchers understand how an entire economy is affected by temporary changes in economic policy and other factors.
PETER A. DIAMOND | DALE MORTENSEN
“For their analysis of markets with search frictions.”
The laureates were recognized for their work that developed a new theoretical framework for understanding how markets work with "search frictions." This
is the term economists use to describe a market in which buyers and sellers do not have enough information to immediately identify each other. Over the past
three decades, Diamond and Mortensen have both received multiple NSF awards.
“For her analysis of economic governance, especially the commons.”
OLIVER E. WILLIAMSON
“For his analysis of economic governance, especially the boundaries of the firm.”
Ostrom has demonstrated how common property can be successfully managed by user associations. Williamson has developed a theory where business firms serve
as structures for conflict resolution. Ostrom has received NSF support from the 1970s to 2009 including a 2005 award
(0527165) for collaborative research on human and environmental systems
interactions; a 2004 award ( 0432894) for dynamics of rules in commons dilemmas;
and a 2001 award (0083511) for biocomplexity research on agent-based models of land
use decisions and emergent land use patterns. Williamson received NSF support in 1977 (
7707168) for an economic assessment of the organization of work and in 1980 (7924111)
for the transaction cost approach in antitrust economics.
“For his analysis of trade patterns and location of economic activity.”
His work on the effects of economies of scale on trade patterns and on the location of economic activity have extensively reoriented research on these issues. Krugman received NSF support for research from the 1970s to the 1990s, including the 1991 award (#9111380) to develop and empirically test models of the location of production within countries, as a way of shedding light on the forces driving international trade and investment.
LEONID HURWICZ | ERIC S. MASKIN | ROGER B. MYERSON
“For having laid the foundations of mechanism design theory.”
Their work, building on game theory, enables researchers to analyze the possible outcomes of applying different sets of rules to a given problem to determine
the optimal mechanism for achieving the best result. Hurwicz received NSF support for collabortive research on systems and techniques of economic organzation from
the early 1970s to the mid-1980s, including an award in 1971 (#7103780). Maskin has
received NSF support since 1977, including a 2006 award (#0618345) for theoretical
research in the areas of dynamics, auctions, and voting. Myerson received NSF support in 1986 and 1993, including an award
(#8605619) for research into negotiation and equilibrium in games.
EDMUND S. PHELPS
“For his analysis of intertemporal tradeoffs in macroeconomic policy.”
Phelps' work in the 1960s and 1970s challenged the prevailing view of the relationship between inflation and unemployment represented by the Phillips curve and
led to a better understanding of the short-term and long-term effects of economic policy. The Columbia University professor has received a number of research grants
from NSF. His first award was GS-33374, "The Economics of Income Redistribution." He received an award in 1987
(#8721847) for "Microeconomic Foundations for a Real Theory of Employment Fluctuations."
ROBERT J. AUMANN | THOMAS C. SCHELLING
“For having enhanced our understanding of conflict and cooperation through game-theory analysis.”
Aumann and Schelling were honored for enhancing our understanding of conflict and cooperation through game-theory analysis. Their insights have also proven highly
relevant to real-world conflict resolution and the prevention of war. Both Aumann and Schelling have been supported by NSF grants.
Affiliation: University of Jerusalem, Jerusalem, Israel
Affiliation: University of Maryland, College Park, MD
NSF Support: #9123774
FINN KYDLAND | EDWARD C. PRESCOTT
“For their contributions to dynamic macroeconomics, the time consistency of economic policy and the driving forces behind business cycles.”
Finn Kydland of Carnegie Mellon University and the University of California, Santa Barbara, and Edward Prescott of Arizona State University were awarded the 2004
Nobel Memorial Prize in Economics for their contributions to macroeconomics, particularly in addressing the time-consistency problem in formulating economic policy
and in understanding the causes of business cycles. Both Kydland and Prescott have long histories of funding from NSF, which supported the Nobel-honored research.
ROBERT F. ENGLE III
“For methods of analyzing economic time series with time-varying volatility (ARCH).”
CLIVE W.J. GRANGER
“For methods of analyzing economic time series with common trends (cointegration).”
Engle and Granger shared the 2003 Economics Prize for their research and collaboration over the years leading to statistical methods for time series data that
have become a routine part of financial analysis today. Their methods have become standard tools for such tasks as forecasting stock market performance, evaluating
investment portfolio risks and analyzing interest-rate trends. NSF has supported their research for the past quarter century. NSF support for Engle includes a series
of nine awards from the late 1970s (#7707166) through the late 1990s (#9730062). Granger's NSF support includes 16 awards from 1974 (#7412243) to 2001
“For having integrated insights from psychological research into economic science, especially concerning human judgment and decision making under uncertainty.”
“For having established laboratory experiments as a tool in empirical economic analysis, especially in the study of alternative market mechanisms.”
NSF support for Kahneman includes awards starting in the 1990s (#9109670) for his research on decision making and uncertainty. NSF's support for Smith began with an award in 1962 and includes a series of 20 electronically available awards
from the mid-1970s (#7520043) to 2001 (#0129744)
related to applied and empirical economic studies.
GEORGE A. AKERLOF | A. MICHAEL SPENCE | JOSEPH E. STIGLITZ
“For their analyses of markets with asymmetric information.”
NSF support for Akerlof includes 13 awards from the 1970s (7523076) to the 2000s. Spence's NSF support includes three awards in the 1970s (37309257). Stiglitz
has been supported by 10 NSF awards from 1974 (7422182) to the 2000s (#0333418).
JAMES J. HECKMAN
“For his development of theory and methods for analyzing selective samples.”
DANIEL L. MCFADDEN
“For his development of theory and methods for analyzing discrete choice.”
NSF support for Heckman has included a series of 13 awards from 1977 (#7727136) to the 2000s
(#0241858). McFadden's NSF support includes
18 awards starting in the 1970s (#7305649).
ROBERT A. MUNDELL
“For his analysis of monetary and fiscal policy under different exchange rate regimes and his analysis of optimum currency areas.”
NSF support for Mundell spans 1967-1969 for his research on “International Economic Crisis.”
“For his contributions to welfare economics.”
NSF supported Sen while he was at Harvard University with awards in 1988 (#8822107) and 1992 (#9212337) on economics and welfare, rationality and social ethics.
ROBERT C. MERTON
“For a new method to determine the value of derivatives.”
NSF support for Merton began with a NSF Fellowship and has included awards in the 1970s (#7504053, #7907840) on economic theory, stochastic processes and
economic-biologic mechanisms (both with Paul Samuelson).
ROBERT E. LUCAS JR.
“For having developed and applied the hypothesis of rational expectations, and thereby having transformed macroeconomic analysis and deepened our understanding
of economic policy.”
NSF support for Lucas includes a 1964 award on the economic theory of technological change and a series of eight electronically available awards starting spanning
the 1970s (#7516869) to the 1990s (#9408649) for studies of the business cycle, stabilization theory and monetary theory.
JOHN C. HARSANYI | JOHN F. NASH JR.*
“For [joint] pioneering analysis of equilibria in the theory of non-cooperative games.”
NSF supported Harsanyi as early as an award in 1962. His later awards included grants in the 1970s (7706394) and 1980s (8218938, 8700454). Nash received his first NSF
support, including a 1958 international travel grant and a 1960 Senior Postdoctoral Fellowship, just before he began the period of mental illness described in the book
and movie, "A Beautiful Mind." In 2000, Nash received an award
for the study of multi-player cooperative games by the means of reducing them to non-cooperative games, that is, the "Nash program."
ROBERT W. FOGEL | DOUGLASS C. NORTH
“For having renewed research in economic history by applying economic theory and quantitative methods in order to explain economic
and institutional change.”
NSF support for Fogel includes an award as early as 1967 for a study of the American iron industry and five awards in the 1970s (#7600002) and 1990s (#9122238)
on historical studies of economics issues. North received an NSF award in 1967 on models of European economic growth.
GARY S. BECKER
“For having extended the domain of microeconomic analysis to a wide range of human behaviour and interaction, including nonmarket behaviour.”
NSF supported Becker with a series of six awards in the late 1970s (#7825704) and through the 1990s (#9310495) for topics from the economic analysis of
the family to the evolution of preferences over time.
ROBERT M. SOLOW
“For his contributions to the theory of economic growth.”
Solow first received NSF support in the form of a Senior Postdoctoral Fellowship in 1963. His awards also include an electronically available award
in 1975 (#7514258) for the economics of natural resources.
JAMES M. BUCHANAN JR.
“For his development of the contractual and constitutional bases for the theory of economic and political decision making.”
NSF support for Buchanan began with an award in 1964, continuing through a 1979 award (#7924857) for problems of implementing and enforcing distributional
norms through the political process. He also received an award for a conference in 2002 (#0136798).
“For his pioneering analyses of saving and of financial markets.”
NSF support includes a 1979 award (#7926733) on the monetary mechanism and stabilization policy.
“For having incorporated new analytical methods into economic theory and for his rigorous reformulation of the theory of general equilibrium.”
NSF support began with an award in 1964 for informational efficiency of prices and continued with six electronically available awards through 1985
(#8510900), with the latter being an award for the law of demand and information processing in economic systems.
GEORGE J. STIGLER
“For his seminal studies of industrial structures, functioning of markets and causes and effects of public regulation.”
Stigler has been supported by NSF as a funded associate of an omnibus award to University of Chicago for law and economics.
“For his analysis of financial markets and their relations to expenditure decisions, employment, production and prices.”
NSF support began as early as 1966 and includes three electronically available awards in the 1970s (#7305481, #7613448, #7704083) for economic theory
and econometrics, financial flows and macroeconomic theory.
LAWRENCE R. KLEIN
“For the creation of econometric models and the application to the analysis of economic fluctuations and economic policies.”
NSF support dates to an award in 1961, continuing through seven electronically available awards, starting with a 1973 award (#7305675) for
international connection of national econometric models.
HERBERT A. SIMON
“For his pioneering research into the decision-making process within economic organizations.”
Simon's NSF support began after he moved from economics to studies of cognitive science and artificial intelligence. He was supported in the 1970s
and 1990s by cognitive science awards (#7309230, #7825033, #9121027) and computer science awards (#7704440, #7821986).
TJALLING C. KOOPMANS
“For [his joint] contributions to the theory of optimum allocation of resources.”
NSF's awards to Koopmans began with a 1959 economics award and includes awards in 1977 (#7703275) for optimal economic growth and in 1980 (#8007171) as
part of an interdisciplinary study of materials modeling. He also participated in two large five-year awards starting early 1960s to the Cowles
Foundation at Yale.
“For the development of the input-output method and for its application to important economic problems.”
NSF support includes research awards as early as 1959 and 1962.
KENNETH J. ARROW*
“For [joint] pioneering contributions to general economic equilibrium theory and welfare theory.”
NSF support for Arrow began with an award in 1961 and continued with a dozen electronically-available awards from the 1970s (7309142) to the 1990s (9209892).
PAUL A. SAMUELSON*
“For the scientific work through which he has developed static and dynamic economic theory and actively contributed to raising the level
of analysis in economic science.”
NSF support includes awards in 1975 (#7504053) and 1979 (#7907840) on economic theory, stochastic processes and economic-biologic mechanisms,
both with Robert Merton.
* Received NSF support after receiving Nobel Prize.
# Received NSF support as graduate students who were part of an NSF grantee's group, as members of an NSF-supported team, and/or users of NSF-supported facilities; see the list of
Physics laureates to learn how they were supported by NSF.