Richard H. Thaler from University of Chicago received Nobel Prize in Economics this week. It’s not only a prestigues award. As it is broadly commented in mass media, winners become celebrities not only in academia. And did I mentioned that Thaler played a scene with Selena Gomez in Big Short?
We asked editors from Open Economics for comments on that choice. Is it important for academia? Will it change our everyday life?
Thaler represents behavioral economics. He created a model of price reactions to information, but is also known for his and Cass Sunstein’s nudge theory (see Nudge: Improving Decisions About Health, Wealth, and Happiness, Yale University Press, 2008). Nudging can help people make better choices, by creating whole choice architecture, where such details as a number of choices or the way they are described matters. These theories can be controversial, though. As critics often point, that it can lead to limitations of individual autonomy by manipulating and limiting choices.
Luisa Blanco-Raynal (Pepperdine University) is enthusiastic about this year’s winner:
His work is extremely interdisciplinary in nature and has important policy applications. This award says something about the significant role economists play improving the wellbeing of individuals.
Jeffrey DeSimone (University of Alabama at Birmingham) agrees that Thaler’s work not only can improve our lives in future but did it already, even if we are not aware of that:
I think Thaler is a great choice for the Nobel Prize in Economics. Ideas from the field he helped build, behavioral economics, not only are appreciated by lots of people who might otherwise have little additional knowledge of economics, but moreover have likely improved the lives of many who, without realizing, have benefitted from policies that rely on these ideas (such as behavioral nudges).
University of Chicago has 29 affiliated prize winners (check the list here), which makes it most awarded university in the world. It’s also an ideal example of how heterogeneous university can be. Zijun Wang (University of Texas at San Antonio) makes a good point on that:
In 1995, University of Chicago professor Robert Lucas won the Nobel Prize in economics for his contributions to rational expectations theory. At the same year, the university also made a rational decision to hire Richard Thaler who now also won the prize for his contributions to behavior economics. So, the two schools of thoughts can prosper under the same roof only if economics research is open.
The Prize can also be a clear sign for new scientists, that it’s not only mainstream that matters. Jeffrey DeSimone points, that as documented by Michael Lewis in The Undoing Project, his humble beginnings in the profession, and rise to prominence only after following his interests and intuition despite resistance within the discipline, is somewhat of an inspiration.
Will this year’s Nobel Prize herald a shift in mainstream economics towards less rational, more emotional models? And will economics be more and more interdisciplinary? The future of economics looks exciting!
About the Prize in Economic Sciences 2017 (Official Website of the Nobel Prize)