Richard Thaler of United States wins Nobel Economics Prize

How Richard H. Thaler's Clear Thinking Led to a Nobel Prize in Economics

Economist Richard Thaler of the Chicago University won the 2017 Nobel prize for economics for his study on behavioural economics, which shows how people's choices on economics matters.

Thaler developed the theory of "mental accounting", explaining how people simplify financial decision-making by creating separate accounts in their minds, focusing on the narrow impact of each individual decision rather than its overall effect.

UR Assistant Professor of Economics Asen Kochov described Thaler's foundational work in behavioral economics as "one of the main developments in economics in the last 50 years".

Thaler, 72, "is a pioneer in behavioral economics, a research field in which insights from psychological research are applied to economic decision making", a background paper from the academy said. In fact, he co-authored a book, Nudge, Improving Decisions About Health, Wealth and Happiness, which became a best-seller.

Thaler said he will likely use the prize money of 9-million-kronor ($1.1-million) in irrational ways.

The head of the Royal Swedish Academy of Sciences says the committees that choose Nobel Prize winners will meet this winter to discuss gender and ethnic diversity issues in the prestigious awards.

While Americans have dominated the Nobel science and economics prizes, another category of researchers - women - have been few and far between.

The Swedish National Bank Prize in Economic Sciences in Memory of Alfred Nobel was first granted to its first recipients, Ragnar Frisch of Norway and Jan Tinbergen of the Netherlands, nearly 70 years after the series of prestigious prizes that Nobel helped establish through funding set aside in his will.

The prize was awarded for “understanding the psychology of economics, ” Swedish Academy of Sciences secretary Goeran Hansson said Monday.

Since it was first awarded in 1969, Americans have dominated the economics prize, with 56 of the 79 laureates holding U.S. citizenship, including those who have dual nationalities.

Related news: