“Creative destruction” theorists Joel Mokyr, Philippe Aghion and Peter Howitt have won Nobel Prize in Economics 2025 “for showing how new technology can drive sustained growth”, according to The Royal Swedish Academy of Sciences.
“Over the last two centuries, for the first time in history, the world has seen sustained economic growth. This has lifted vast numbers of people out of poverty and laid the foundation of our prosperity,” the Academy said in a press statement on Monday.
“This year’s laureates in economic sciences—Joel Mokyr, Philippe Aghion and Peter Howitt—explain how innovation provides the impetus for further progress.”
Nobel Prize In Economics 2025
Here's a quick profile of the winners, who they are and what they do:
Joel Mokyr: Born in Leiden, the Netherlands, in 1946, Mokyr earned his PhD from Yale University in 1974, He is curently a professor at Northwestern University, illinois.
Philippe Aghion: Born in Paris, France, Aghion earned his PhD from Harvard University in 1987. He is currently professor at Collège de France and INSEAD, Paris, and London School of Economics.
Peter Howitt: Born in Canada in 1946, Howitt earned his PhD from the Northwestern University, Illionois. He is currently professor at the Brown University.
{{/usCountry}}Peter Howitt: Born in Canada in 1946, Howitt earned his PhD from the Northwestern University, Illionois. He is currently professor at the Brown University.
{{/usCountry}}While one of the Economics Nobel went to Mokyr “for having identified the prerequisites for sustained growth through technological progress”, the other half went jointly to Aghion and Howitt “for the theory of sustained growth through creative destruction”.
While one half of the prize money of 11 million Swedish kronor will go to Mokyr, the other half will be shared between Aghion and Howitt.
‘Creative Destruction’
Mokyr used historical sources as one means to uncover causes of sustained growth becoming the new normal. He showed that if innovations are to succeed one another in a self-generating process, we not only need to know that something works, but we also need to have scientific explanations.
That was 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 also studied the mechanisms behind sustained growth. In an article from 1992, they constructed a mathematical model for “creative destruction” — when a new and better product enters the market, the companies selling the older products lose out.
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“The laureates’ work shows that economic growth cannot be taken for granted. We must uphold the mechanisms that underly creative destruction, so that we do not fall back into stagnation,” says John Hassler, chair of the committee for the prize in economic sciences.