This year's Nobel Prize in Economics marks a return to the roots of economic science by focusing on fundamental questions: what moves humanity forward and how are the conditions for sustainable economic development created?
On October 13, 2025, the Royal Swedish Academy of Sciences awarded the prize to three economists for their research on the role of technology, innovation and knowledge in shaping long-term economic progress. Unlike recent years, this award recognized those who studied not only specific social groups or institutions but the very nature of economic growth and innovation itself.
In 2023, Claudia Goldin received the prize for her analysis of women's participation in the labor market. The 2024 award went to researchers studying the role of institutions in national development, notably through the book "Why Nations Fail." Both approaches were socially significant but did not address the deeper drivers of progress.
The 2025 prize acknowledges scholars who explored the fundamental mechanisms of change: how historical conditions and cultural factors determine the emergence of technological innovation. One laureate, Keir, closely examined why the West became an innovation leader and demonstrated that wealth alone does not guarantee progress—rather, culture that supports knowledge exchange and innovation is crucial.
The other two awardees introduced a mathematical model of "creative destruction"—the process by which companies invest in research, produce new products, and are eventually displaced by even more innovative competitors. This ongoing renewal leads to economic growth. The key conclusion: countries prosper not because of resources but due to a culture that fosters innovation and knowledge.
Thus, the Nobel Committee has refocused attention on the underlying mechanisms of progress, emphasizing the importance of culture and ideas in societal development.
