Three Scholars Win the 2025 Prize in Economic Sciences for Explaining Innovation-Driven Economic Growth

On October 13, 2025, in Stockholm, Sweden, the Royal Swedish Academy of Sciences announced that the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2025 was awarded to Joel Mokyr, Philippe Aghion and Peter Howitt, for having explained innovation-driven economic growth. The prize amount is 11 million Swedish kronor, with one half to Mokyr, for having identified the prerequisites for sustained growth through technological progress, and the other half jointly to Aghion and Howitt, for the theory of sustained growth through creative destruction.

Over the last two centuries, for the first time in history, the world has seen sustained economic growth, which has lifted vast numbers of people out of poverty. Before that, stagnation was the norm throughout most of human history: despite important discoveries now and again, growth always eventually levelled off. In different ways, the laureates explain why this change became possible and what is necessary for continued growth.

Mokyr used historical sources to uncover the causes of sustained growth becoming the new normal. He demonstrated that if innovations are to succeed one another in a self-generating process, we not only need to know that something works, but also need scientific explanations for why, which were often lacking prior to the industrial revolution. He also emphasised the importance of society being open to new ideas and allowing change.

Aghion and Howitt studied the mechanisms behind sustained growth. In an article from 1992, they constructed a mathematical model for what is called creative destruction: when a new and better product enters the market, the companies selling the older products lose out. The innovation is creative, but also destructive, as the company whose technology becomes outdated is outcompeted, and such conflicts must be managed in a constructive manner, or innovation will be blocked by established companies and interest groups. John Hassler, chair of the Committee for the Prize in Economic Sciences, said the laureates' work shows that economic growth cannot be taken for granted and that the mechanisms underlying creative destruction must be upheld so that we do not fall back into stagnation. Mokyr is at Northwestern University in the United States and Tel Aviv University in Israel, Aghion is at Collège de France and INSEAD in Paris and the London School of Economics and Political Science, and Howitt is at Brown University in the United States.

Related: Venezuelan Opposition Leader Machado Wins the 2025 Nobel Peace Prize

(Source: The Royal Swedish Academy of Sciences)

Source: The Royal Swedish Academy of Sciences

Published by GSM · USA (original Chinese edition)

Photo: 图：Joel Mokyr 在斯德哥尔摩发表诺贝尔讲座。Karen Zhou，CC BY-SA 4.0，经 Wikimedia Commons。 / Photo: Joel Mokyr delivering his Nobel Prize lecture in Stockholm. By Karen Zhou, CC BY-SA 4.0, via Wikimedia Commons.

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