This year’s awarding of the Nobel Prize for economics to Joel Mokyr is widely seen as a victory for history. But it might also help us understand the frustrations and desires — not to mention the intellectual priorities and possible future — of economics in the 2020s.
Mokyr was nobody’s most likely candidate for the economics Nobel, but almost no one begrudges him the award either. He is one of economic history’s pre-eminent figures and one of its most popular, a joy to read. And he has devoted his career to answering one of economics’ central puzzles: how do we promote productivity and economic growth? How do we build the incomes of entire populations and whole generations?
Mokyr’s answer to the prosperity puzzle is that the flow of new ideas must keep adding to our stock of useful knowledge. Importantly, prosperity will only take off if it can build on itself in a sort of virtuous spiral. And you need to generate not one but two different forms of knowledge:
• propositional knowledge, such as empirical studies, which tells people how things are; and
• prescriptive knowledge, such as written instructions, which tells people how to get things done.
Finally, for all that knowledge accumulation to happen, you need a particular form of culture — one that is open to spreading knowledge broadly, to the possibility that knowledge will change, and to the idea that people will apply this knowledge.
If you want to read some of Mokyr’s work, you can try his Nobel citation and longer background paper and then this paper on the Industrial Revolution (or read Kevin Bryan’s excellent summary of the latter). Mokyr’s big four books are The Lever of Riches (his most popular), The Gifts of Athena, The Enlightened Economy and A Culture of Growth. They’re all great, and all impressively readable for the non-economist. That last one, spelling out Mokyr’s broad cultural story, may be the most significant.
In an economy worried about its capacity to innovate and grow, Mokyr tells the biggest story of all, a story informed by the full sweep of human history. You might think we should have seen his Nobel coming.
The quest for growth
Economists really, really want to understand economic growth. The economist Robert Lucas (Nobel 1995) once memorably quipped that, as an economist, once you start thinking about growth you can’t think of anything else. A great many economists agree; Mokyr used repeated that Lucas quote in an interview within hours of his Nobel win.
It’s the quest Adam Smith embarked on in the 1770s with his The Wealth of Nations and David Ricardo continued after Smith’s death: finding the laws that determine an economy’s expansion.
A simple thought experiments explain why so many economics pursue it: growth matters to people’s lives in a way that most people don’t realise. Just over 250 years ago, the world’s most powerful person was the French king Louis XV. All his riches could not save him from smallpox, a disease that not even the poorest person in an advanced economy will die from today. And this is just one of hundreds of examples of growth’s benefits.
Not surprisingly, Smith and Ricardo lacked a detailed understanding of how their economies had entered a new growth path, so they compared the different economies of their own era. But since the 1950s economists have increasingly compared economies across time as well.
The dominance of models
For some time after the growth puzzle came back into focus in the 1950s, the economics profession seemed to focus on mathematical models. In particular, the profession made many mathematical extensions to the original “exogenous growth” model devised in large part by Robert Solow (Nobel 1987). Solow’s doctoral students alone included four future Nobel winners. Mathematical breakthroughs also helped win Nobels for the aforementioned Robert Lucas, and for people like Paul Romer (Nobel 2018). Such people integrated factors like human capital, technological innovation and imperfect markets into the dominant mathematical growth models.
If you have come across someone angrily declaring that economists want to reduce all of people’s behaviour to mere mathematical modelling, then this sort of economics is probably what they have in mind. You might suggest to such people that this approach peaked thirty years ago (perhaps marked by Lucas’s 1995 Nobel). Just don’t expect they’ll thank you for the tip.
(You might also tell your angry anti-modelling interlocutor that economic models are almost by definition pretty useful in economics, in the same way that maps are useful in geography and architectural drawings are useful to builders. They probably won’t thank you for that, either.)
Empiricism resurgent
If the back end of the 1900s was the era of mathematical models in economics, the 2000s so far have been the scene of the “credibility revolution.”
You can still win a Nobel partly for work on models, as Romer did in 2018. Indeed, while Mokyr won half of this year’s Nobel, the other half went to Philippe Aghion and Peter Howitt who, like Romer, extended the modelling of innovation. But the interest in mathematical models has gone off the boil.
The focus of the 2000s has mostly been on practical empirical methods. You still use maths, but now it’s in conceptual tools like difference-in-differences, instrumental variables and randomised controlled trials. You would have been most likely to win your Nobel for showing why people ended up with lousy used cars (Akerlof, Nobel 2001) or how to think about the prices of assets like your house (Fama, Hansen and Shiller, Nobel 2013) or the regulation of companies like Google (Tirole, Nobel 2014) or whether minimum wages make sense (Card and Krueger, Nobel 2021). In this work, economists want to make a casual claim: this led to that.
The field being economics and the year being 2025, there’s now even a paper that makes this point using a dataset of 44,000 economics papers. The authors argue that “the average proportion of causal claims in papers rose significantly from approximately 5 per cent in 1990 to around 28 per cent in 2020.”
The move to history
In his first public remarks on winning the Nobel, Joel Mokyr explained that he never expected to win a Noble Prize because of, well, history: no economic historian had won an economics Nobel except Robert Fogel and Douglass North back in 1993.
Mokyr is usually insightful. And there has very likely been too little economic history taught in schools and universities. But his historical analysis of the Nobel seems to me quite wrong.
Yes, the 2000s had been increasingly about practical empirical methods. But in the 2020s, the Nobels have markedly favoured economic history:
• In 2022 Ben Bernanke got a Nobel for analysis the Great Depression of the 1930s — and also, as US Fed chair, for applying that analysis to the 2008 recession.
• In 2023 Claudia Goldin won for spending decades building up and rigorously analysing decades of data on women’s labour. Goldin sees herself — rightly, I think — as an economic version of Sherlock Holmes. But she is also adamant that her work is economic history. “I am first and foremost an economic historian,” she told me in 2022, with Sherlockian matter-of-factness.
• In 2024 Acemoglu, Johnson and Robinson won for an explanation of historical growth that argued prosperity springs from good institutions. This involved looking at a lot of institutional history. Indeed, on this point Mokyr has been in the very best sort of multi-decade dialogue with his 2024 predecessors, characterised by disagreement, provocation, consultation and mutual respect. Take a look at the Mokyr’s presence in the authors’ comments and footnotes to Acemoglu and Johnson’s “Machinery and Labor in the Early Industrial Revolution, and in the Age of AI,” from way back in the April 2024 world where none of these people yet owned a Nobel.
A sensible reaction
As far as I can see, the Nobel committee is working hard to encourage a broadening of economics. It has done this before: in 2002 it gave a Nobel to Daniel Kahneman, who didn’t even consider himself an economist though his psychological research helped found a field called behavioural economics. But now it seems to have embraced economic history hard. First it awarded Acemoglu, Johnson and Robinson, even though their ideas are more popular than proven. Now it has awarded Mokyr, whose ideas seem even less testable.
You might question the choice on this ground. A more useful way to see it might be that economics is trying out different approaches, and that this seems a good thing. •
