This Year's Economics Nobel Has a Specific Focus

Two researchers at American universities have been awarded the Nobel Prize for their work on climate change's role in the world economy. Yale University's William Nordhaus was named for integrating climate change into long term macroeconomic analysis—as the Guardian notes, he is "the founder of environmental economics"—and New York University's Paul Romer was awarded for factoring technological innovation into macroeconomics, per the AP. Romer is the originator of something called "endogenous growth theory," which, as the Wall Street Journal explains, "tries to explain how the pace of technological change can be sped up by choosing policies that promote research, development, and access to better education." They will share the $1.01 million prize.

• Nordhaus was “the first person to create a quantitative model that describes the global interplay between the economy and climate,” the Swedish Academy said. “His model is now widespread and is used to examine the consequences of climate policy interventions, for example carbon taxes.”
• The awards come on the same day as a dire climate warning from international scientists, but Romer sounded an optimistic note. "It is entirely possible for humans to produce less carbon," he said Monday. "Once we start to try to reduce carbon emissions, we’ll be surprised that it wasn’t as hard as we anticipated."

(More Nobel Prize in economics stories.)