There is no Nobel Prize in Economics! And here we're not even stating the obvious, since most of the audience that consumes Nobel news year after year is completely unaware of this basic fact. Even academic economists ignore, or prefer to ignore, that the prize, awarded to "economists" since 1969, is genuinely a "Swedish Bank Prize in Economic Sciences in Memory of Alfred Nobel." But what does that matter, if the whole world is busy praising, after a herculean effort of translation into the vernacular, the discoveries of these "scientists"?
It turns out that the story always It matters. Even more so when dealing with this chimerical creation that has never hidden its ambition to elevate the prestige of a certain conception of Economics to the level of a true science in the eyes of the general public.[1]
The artifices behind this construction were the work of Per Åsbrink, who, around 1955, became governor of the Riksbank, the Central Bank of Sweden. Åsbrink was an economist responsible for unconventional maneuvers to achieve his immodest goals. In 1957, he had already become notorious for perpetrating the infamous "interest rate coup," when, defying the Swedish parliament, he raised interest rates, ending years of the low-interest rate policy of the Swedish Social Democracy, which sought to stimulate job creation and contribute to post-war reconstruction efforts. Once again disobeying the prerogatives of parliament, and with increased revenues from its conservative monetary policy, it created a fund administered by the Riksbank for the celebrations of its third centenary jubilee, erected an unsightly granite mausoleum as headquarters for its new facilities, and granted itself control of substantial resources for financing research in the field of Economics.
Therefore, nothing would stop Åsbrink in his ambition to create a Nobel Prize for Economics: neither the testamentary wishes of Alfred Nobel, nor the will of the Swedish parliament, nor even the opposition of the heirs of the Nobel Foundation. When confronted with the obstacle that economists had no seat on the Royal Swedish Academy of Sciences – the committee responsible for the awards – Åsbrink promptly replied that his close aides would take charge of electing the laureates. Thus, the “Nobel” in Economics, against all odds, would be created in 1969.
But what could lie behind such ambition? Here, as often happens in these stories that, although real, reek of conspiracy theories, the details become even more intriguing. For the connections between Åsbrink and the Mont Pèlerin Society were numerous and well-established.
The Mont Pèlerin Society, it is worth remembering, is the International Association created at the end of the Second World War to bring together the cream of neoliberal thinkers, as they came to call themselves, interested in refounding and promoting a renewed liberalism, its principles and values. Eminent, let's call them, "public intellectuals" who had great prominence in the field of Economics participated in it. In the case of Hayek, Friedman, Stigler, Buchanan, Allais, Coase and Becker, they were all awarded a Nobel Prize.
The connections between Åsbrink, his close collaborators, and the Mont Pèlerin Society were modulated through various channels: through their shared education at certain universities, especially American ones, committed to neoliberal ideology; through the abundant resources and personnel from the Riksbank and Swiss banks to finance the Society's first meetings; through these individuals' common interests in the political machinations of the People's Party, in open opposition to Swedish Social Democracy; and through a communion of ideas and interests in the struggle with Keynesianism for hegemony in the conduct of economic policies in central countries.
The result of establishing the Nobel Prize was quite promising: inserted into a broader context of disputes, it ended up integrating and reinforcing a process that culminated in the triumph of neoclassical economists in the US, who until then had shared the spotlight with the (original, at that time) institutionalists, and in the circulation of neoliberal ideas. The overlaps between neoclassicals and neoliberals are always a matter of debate, but there is no denying that the Nobel Prize overwhelmingly privileged this school of thought among economists, especially Americans, and, in their vast majority, graduates of the same universities, such as Chicago or the Ivy League. Incidentally, just as a matter of curiosity, of the 99 laureates, three were women. One was black.
What, then, can be said about this "Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel" of 2025?
Let's focus on two winners who caused the greatest stir, partly because they are better known among us. Here we refer to Philippe Aghion and Peter Howitt, laureates for their contributions to the theory of growth based on so-called "creative destruction"—a process in which waves of innovations follow one another.
The idea of "creative destruction" was coined by Joseph Alois Schumpeter, an economist born in the former Austro-Hungarian Empire in 1883. In his seminal 1942 work, "Capitalism, Socialism and Democracy," Schumpeter portrayed "creative destruction" as an inexhaustible and endogenous process in capitalism, responsible for creating, in an explicit biological analogy, mutations in the industrial field that would sweep away old industries in favor of new structures bearing innovations, or these "new combinations of materials and methods." According to Schumpeter, this is the fundamental fact of capitalism, this is what economic development consists of, and it is amidst this whirlwind of the "perennial winds of creative destruction" that companies must struggle to survive.
But if the idea is Schumpeter's, more than 80 years ago, there must be something brilliant and innovative in the verve of these two laureates, right? Absolutely not. Their models, quite formalized, restricted to conventional optimization rules, within the framework of the elegant balancing mechanics of the neoclassicists, arrive at rather limited and disappointing results.
However, it must be said that Schumpeter's ideas have borne much fruit in another field. Since the 1980s, authors who inherit the tradition of the "father of innovation," known as neo-Schumpeterians, have created a fertile field of theorizing, with countless tools and useful concepts about the processes of technical change, their unfolding paths, the forms and peculiarities of economic development processes, the architecture of National Innovation Systems, and the designs of more informed public policies to leverage these processes. catching up or forging aheadHowever, this prodigious group of authors and their teachings, with seminal contributions to the study of innovation, would never be considered for a Nobel Prize.
Thus, if in the current moment of civilizational crisis it is necessary to reaffirm and redouble bets on narratives of unlimited economic growth and the Promethean myths of technological progress, how about carefully selecting those who, confined to conventional canons, have managed to distill one, or perhaps two, ideas from the immense flow of neo-Schumpeterian contributions, neutralizing any roughness for the firmly uniform ranks of conventional thought? Aghion and Howitt were the perfect pair for this commissioned role.
Given the unease of contemporary times, however, shouldn't it seem somewhat strange that a distinction is awarded to work that promotes the ideal of sustained economic growth? Note that we are not talking about sustainable, but about sustained, that is, continuous and unlimited economic growth.
We are living in times of unprecedented environmental collapse. We have managed the feat of imprinting humanity's mark, in its historical time, on the very long-term dimension of geological phenomena. The Anthropocene – or, more precisely, the Capitalocene – is the epoch we have produced, in which a particular form of human organization becomes a force for transforming the biogeochemical systems of the Earth. We are witnessing the sixth great mass extinction on our planet. Of the nine planetary boundaries, seven have already been crossed. It is worth remembering: planetary boundaries represent the thresholds of terrestrial systems that guarantee the resilience of the fundamental metabolic processes that sustain and nourish the web of life on Earth. Crossing these boundaries means traveling down roads of no return, paths that will lead us to unknown territories and, unfortunately, quite hostile to life. We, too, human beings, are part of the web of life. There are times when the glaringly obvious deserves to be reaffirmed.
There is a legion of authors who recognize the intricacies of this complex systemic crisis in which humanity has become entangled. Many suggest that the paths we have pursued so far, while they may have brought prosperity to a select few, will never lead to the generalization of this prosperity. In other words, capitalism has managed to create an affluent way of life for some elites on the planet. We say affluent, not meaningful, liberating, or desirable. The words matter here.
To sustain this “imperial” way of life, immense masses of dispossessed people, on the peripheries of the world, or in hot neighborhoods From the central countries, they too are invited. Invited to exploitation, to be expropriated of their bodies, their territories, their knowledge, their traditional ways of life, their worldviews. Without this Atlantic commitment, the party doesn't happen. There is no revelry upstairs without invisible servants to serve the table.
We economists, raised on the mantra of economic growth, know that we have difficulty envisioning a different world. Sometimes, some more iconoclastic individual comes along to poke at our sacred cow. What kind of monster is this called GDP? Whom does it serve? In 1968, Robert Kennedy, in an inspired speech at the University of Kansas, suggested that GDP was prodigal in accounting for the napalm spilled on civilian populations in Vietnam, the nuclear bombs, the armored police cars used to quell urban unrest, the television programs that glorified violence to sell toys to children, and the growing production of weapons for civilians. What did GDP not measure? Kennedy answered: “the beauty of our poetry or the solidity of our marriages, the intelligence of our public debates or the integrity of our public officials… nor our knowledge, nor our compassion… it measures everything, in short, except that which makes life worthwhile.”
Wouldn't it be time to consider alternative metrics? Wouldn't it be time to incorporate environmental issues as an integrating and cross-cutting element in our Economics courses? Wouldn't it be time to bring into our classrooms the idea that the laws of physics and entropy continue to apply, even if we produce theoretical models that ignore their relevance? Shouldn't we take seriously the issue of class, gender, and racial inequalities? Isn't it more than urgent to think about the issue of territories impacted by projects that are mortgaging our future? What lessons would be impacted by such an agenda?
And the Nobel Prize? Well, that's what the Nobel Prize is for: to make you think about what's worth thinking about.
This text does not necessarily reflect the opinion of Unicamp.
Paulo Sérgio Fracalanza, Adriana Nunes Ferreira, Alex Wilhans Palludeto, and Simone Deos are professors at the Institute of Economics (IE) at Unicamp, and Rosana Icassatti Corazza is a professor at the Institute of Geosciences (IG) at Unicamp.
[1] This story can be read with great delight in the masterful article by Philip Mirowski, "The neoliberal Ersatz Nobel Prize," in: Dieter Plehwe, Quinn Slobodian, and Philip Mirowski (eds.). Nine Lives of Neoliberalism. Verso Books, 2020.
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