Not-so-dismal science: macroeconomists win Nobel Prize

Two American researchers will share the Nobel Prize in economics for their research into cause and effect in the macroeconomy.

Thomas Sargent, William R. Berkley professor of economics and business at New York University, and Christopher Sims, Harold H. Helm '20 professor of economics and banking at Princeton University, will share the 10 million krona (£950,000) prize, officially known as the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.

During the 1970s and 1980s the pair independently carried out empirical research into the two-way causal relationship between economic policy and macroeconomic variables such as gross domestic product, inflation, employment and investments. The models they developed incorporate the role of market expectations.

Both men were included on a list of Nobel Prize predictions drawn up by Thomson Reuters citation analyst David Pendlebury. Mr Pendlebury also predicted the winners of the prizes in physics, chemistry and physiology or medicine, which were announced last week.

paul.jump@tsleducation.com