Academy of Sciences permanent secretary Hans Ellegren (C), Jakob Svensson (L) and Jan Teorell, of the Nobel assembly at the Swedish Riksbank announces the Swedish Riksbank’s prize in economic science in memory of Alfred Nobel 2024, which goes to Daron Acemoglu, Simon Johnson and James A Robinson, during a press meeting at the Royal Swedish Academy of Sciences in Stockholm, Sweden, on Monday. Photo by Christine Olsson/EPA-EFE
Oct. 14 (UPI) — Three U.S.-based economists were awarded the Nobel Prize in economic sciences Monday for their work examining how institutions are formed and their effect on prosperity.
Daron Acemoglu and Simon Johnson, both from the Massachusetts Institute of Technology, and James A. Robinson, from the University of Chicago, won the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, the committee said.
The Committee for the Prize in Economic Sciences said the three demonstrated “the importance of societal institutions for a country’s prosperity.”
“Societies with a poor rule of law and institutions that exploit the population do not generate growth or change for the better,” it said.
The committee said the European colonization around much of the globe played a role in the wealth of societies because of the institutions they put in place.
“This was sometimes dramatic, but did not occur in the same way everywhere,” the committee said. “In some places, the aim was to exploit the indigenous population and extract resources for the colonizers’ benefit. In others, the colonizers formed inclusive political and economic institutions for the long-term benefit of European migrants.
“Inclusive institutions were often introduced in countries that were poor when they colonized, over time resulting in a generally prosperous population. This is an important reason why former colonies that were once rich are now poor and vice versa.”
The economic situation in colonies often led to political change when poor conditions led to a revolt from the Indigenous people or paved the way to a democratic system of government that ushered out colonial rulers.
“Reducing the vast differences in income between countries is one of our time’s greatest challenges,” Jakob Svensson, chair of the committee said. “The laureates have demonstrated the importance of societal institutions for achieving this.”