Nobel Economics Prize: The Award That Was Not in the Will

The Nobel season reaches its final act on Monday, and it ends with the one prize Alfred Nobel left out of his will. The Royal Swedish Academy of Sciences will announce the winner of the Nobel Economics Prize on October 12, closing out this year's announcement week after awards for medicine, physics, chemistry, literature and peace were already handed out.

The schedule makes Monday an easy day to watch. The Nobel Economics Prize announcement is the last of the six, arriving a few days after Navi Pillay was named this year's peace laureate for her work on international law. By Monday evening the full roster of laureates will be set, and each will collect a medal, a diploma and a share of the prize money at ceremonies in December.

The week so far has been a tour of very different disciplines. Medicine went to Karl Deisseroth, Peter Hegemann and Georg Nagel for their work on light-gated ion channels, the basis of optogenetics. Physics went to Francis Halzen for the IceCube Neutrino Observatory and the discovery of high-energy cosmic neutrinos. Chemistry honored Henri B. Kagan and Kenso Soai for asymmetric organic synthesis, and literature went to the Canadian poet and essayist Anne Carson. The Nobel Economics Prize is the final name on that list, and in some ways the strangest one.

The prize that was not in the will

The economics award is not strictly a Nobel, and the distinction is worth knowing. Alfred Nobel's 1895 will created five prizes: physics, chemistry, medicine, literature and peace. The economics prize was established in 1968 by Sweden's central bank, Sveriges Riksbank, and its formal title runs the full mouthful: the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.

The selection machinery is the serious kind. The academy keeps nominations secret for fifty years, according to the prize organizers, so the public only learns who was considered decades after the fact.

The money is serious as well. This year's full prize stands at twelve million Swedish kronor, roughly one point two million dollars, after the Nobel Foundation raised the purse by one million kronor to mark the anniversary of the first awards. A prize can be split among up to three laureates, with the money divided accordingly, and Reuters reported the increase in September, with the foundation saying it wanted the award to keep its financial weight over time.

The names the odds favor

Nobody outside the committee knows the shortlist, but prediction markets have filled the vacuum. On Polymarket, Ariel Pakes and Michael Woodford sit atop the betting for Monday's award, according to market data reported this week. Close behind is Susan Athey of Stanford at eleven percent odds, whose research on market design, auction theory and econometrics helped shape how economists understand online marketplaces. Athey has also taught courses on cryptocurrency and has described Bitcoin as a revolutionary technology.

Thomas Piketty of the Paris School of Economics and Emmanuel Saez of the University of California, Berkeley, produced the landmark research on income inequality that put "the one percent" into the public vocabulary, and NPR's economics coverage has listed them as contenders for years. Raj Chetty of Harvard, who uses enormous government datasets to map the American dream across cities and generations, is another regular mention. Robert Barro's name shows up on most shortlists too.

Why it matters beyond Stockholm

The Nobel Economics Prize lands differently from the science awards because its subject is policy. Prize-winning research tends to seep into central bank models, tax debates and the design of everything from auctions to welfare programs, which is why finance ministries and newsrooms pay attention even when the underlying math is opaque.

Like every Nobel, the Nobel Economics Prize is decided behind closed doors with no public shortlist, which makes the announcement itself the main event. The academy issues a single citation explaining the choice, and for the researchers involved, the prize turns a lifetime of dense papers into a name the public finally learns.

Whatever the academy decides on Monday, the new laureate or laureates will receive the medal and diploma in Stockholm in December, at the ceremony marking the anniversary of Alfred Nobel's death, while the peace laureate is honored separately in Oslo. The last name of this year's Nobel season is the one nobody can predict.