The 2025 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel recognized Joel Mokyr, Philippe Aghion and Peter Howitt for explaining how innovation can sustain economic growth—and why that process creates conflict. Mokyr received one half of the 11 million Swedish kronor prize; Aghion and Howitt shared the other half.
Who won the 2025 economics prize?
The Royal Swedish Academy of Sciences announced the prize on 13 October 2025. Its formal name is the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, commonly called the Nobel Prize in Economics. The total prize amount was 11 million Swedish kronor.
- Joel Mokyr received one half of the prize. At the time of the award, he was affiliated with Northwestern University and Tel Aviv University.
- Philippe Aghion and Peter Howitt jointly received the other half. At the time, Aghion was affiliated with Collège de France, INSEAD, and the London School of Economics and Political Science; Howitt was affiliated with Brown University.
The Academy’s 13 October 2025 announcement cited the laureates “for having explained innovation-driven economic growth.”
What did the laureates explain about innovation?
Their contributions illuminate complementary parts of the growth story. Mokyr examined the historical and social conditions that let technological progress continue and accumulate. Aghion and Howitt developed a formal model of how new technology can displace older methods and firms, while driving further growth.
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Mokyr: conditions that let innovation build on itself
An invention is more likely to lead to further progress when people understand why it works. That knowledge lets later innovators adapt, improve and extend earlier discoveries instead of relying only on trial and error. Mokyr’s work also emphasizes the importance of openness to new ideas and a society willing to permit change. Together, these factors help explain why technological progress can become sustained rather than isolated.
Aghion and Howitt: growth through creative destruction
Aghion and Howitt’s 1992 mathematical model describes creative destruction: a newer, better product or production method can replace an older one. The process is creative because it brings something new into use; it is destructive because firms relying on the previous technology can lose business or disappear. Their work formalized how this cycle of innovation and displacement can support sustained economic growth.
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The Scientific Background published by the Committee for the Prize explains these contributions. Neither account means that every innovation benefits every firm or person.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Why can innovation face resistance?
When a new product or method threatens established businesses, those businesses and the interest groups around them have reason to resist. The Academy warns that such opposition can block innovation. Creative destruction can therefore support growth while imposing losses on people and organizations tied to older technologies. Managing those conflicts constructively matters: growth is not automatic, and the gains from change do not arrive without disruption.
As John Hassler, chair of the Committee for the Prize in Economic Sciences, said in the Academy’s announcement: “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.”
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