Acemoglu, Johnson and Robinson win Nobel economics prize

The Nobel economics prize has been awarded to Daron Acemoglu, Simon Johnson and James A. Robinson for research into why prosperity varies so widely across countries. The prize committee said their work provided fresh evidence on the role of societal institutions in shaping national wealth.

Acemoglu and Johnson are affiliated with the Massachusetts Institute of Technology, while Robinson is at the University of Chicago. The award, announced on Oct. 14, recognizes scholarship that links political and economic systems to long-run economic outcomes, according to the prize committee.

The committee said one central explanation for the differences in national prosperity is that institutions can persist over time. In its account of the research, the committee focused on how the laureates studied systems introduced by European colonizers and examined their relationship with later economic performance.

“By examining the various political and economic systems introduced by European colonizers, Daron Acemoglu, Simon Johnson and James A. Robinson have been able to demonstrate a relationship between institutions and prosperity,” the prize committee said.

Why institutions were central to the award

In the committee’s description, institutions refer to the political and economic arrangements under which societies operate. Those arrangements can affect how economies develop by influencing the distribution of power, the rules governing economic activity and the durability of those rules over time.

The committee did not frame prosperity gaps as the result of a single factor. It said persistent institutional differences are an important explanation for why some countries have become much richer than others.

The work recognized by the prize addresses a question that has long sat at the center of economics and public policy: why nations with different historical and political systems can end up with sharply different levels of wealth. By emphasizing institutions, the award places attention on the structures that guide economic decision-making rather than on short-term market cycles.

For investors, policymakers and business leaders, the announcement underscores the relevance of political and economic systems to assessments of country-level risk and development. The committee’s statement did not provide a market forecast or policy prescription, but it identified institutional persistence as a key channel through which historical arrangements can be connected to current prosperity.

The prize adds to the public profile of research that compares countries over long periods and considers how systems established in earlier eras may continue to influence economic outcomes. According to the prize committee, Acemoglu, Johnson and Robinson’s contribution was to demonstrate a relationship between institutions and prosperity through their examination of colonial-era political and economic systems.

This story draws on original reporting from MarketWatch.