The 2024 Nobel Prize in Economics has been awarded to Daron Acemoglu, Simon Johnson, and James A. Robinson “for studies of how institutions are formed and affect prosperity.” Their work has offered crucial insights into the role institutions play in influencing economic outcomes and the disparities in wealth across nations.
BREAKING NEWS
The Royal Swedish Academy of Sciences has decided to award the 2024 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel to Daron Acemoglu, Simon Johnson and James A. Robinson “for studies of how institutions are formed and affect prosperity.”… pic.twitter.com/tuwIIgk393— The Nobel Prize (@NobelPrize) October 14, 2024
The trio’s model for understanding institutional formation and transformation focuses on three essential components. First, it addresses the conflict over resource allocation and decision-making power, particularly whether authority rests with an elite group or the broader population.
Second, the model considers how the masses can mobilize and challenge the ruling elite, illustrating that power dynamics extend beyond formal decision-making structures. Finally, it highlights a “commitment problem,” where elites may ultimately be forced to cede control to the general populace.
Through this framework, the laureates have explored the lasting differences in prosperity across countries, linking these disparities to long-standing institutional differences. Their research, particularly in analyzing the political and economic systems created by European colonizers, has shown how institutions profoundly impact a nation’s development and prosperity.
Additionally, their work provides theoretical insights into why these institutional disparities persist over time and how they can evolve.
The Royal Swedish Academy of Sciences, established in 1739, oversees the selection process for the Nobel Prize in Economic Sciences. With approximately 470 Swedish and 175 foreign members, the Academy is recognized for honoring excellence in research across various fields.
