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The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2015

Photo: Princeton University

Angus Deaton

Prize share: 1/1

12 October 2015

The Royal Swedish Academy of Sciences has decided to award The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel for 2015 to

Angus Deaton
Princeton University, NJ, USA

"for his analysis of consumption, poverty, and welfare". 

Consumption, great and small

To design economic policy that promotes welfare and reduces poverty, we must first understand individual consumption choices. More than anyone else, Angus Deaton has enhanced this understanding. By linking detailed individual choices and aggregate outcomes, his research has helped transform the fields of microeconomics, macroeconomics, and development economics.

The work for which Deaton is now being honored revolves around three central questions:

How do consumers distribute their spending among different goods?Answering this question is not only necessary for explaining and forecasting actual consumption patterns, but also crucial in evaluating how policy reforms, like changes in consumption taxes, affect the welfare of different groups. In his early work around 1980, Deaton developed the Almost Ideal Demand System – a flexible, yet simple, way of estimating how the demand for each good depends on the prices of all goods and on individual incomes. His approach and its later modifications are now standard tools, both in academia and in practical policy evaluation.

How much of society's income is spent and how much is saved? To explain capital formation and the magnitudes of business cycles, it is necessary to understand the interplay between income and consumption over time. In a few papers around 1990, Deaton showed that the prevailing consumption theory could not explain the actual relationships if the starting point was aggregate income and consumption. Instead, one should sum up how individuals adapt their own consumption to their individual income, which fluctuates in a very different way to aggregate income. This research clearly demonstrated why the analysis of individual data is key to untangling the patterns we see in aggregate data, an approach that has since become widely adopted in modern macroeconomics.

How do we best measure and analyze welfare and poverty? In his more recent research, Deaton highlights how reliable measures of individual household consumption levels can be used to discern mechanisms behind economic development. His research has uncovered important pitfalls when comparing the extent of poverty across time and place. It has also exemplified how the clever use of household data may shed light on such issues as the relationships between income and calorie intake, and the extent of gender discrimination within the family. Deaton's focus on household surveys has helped transform development economics from a theoretical field based on aggregate data to an empirical field based on detailed individual data.

Read more about this year's prize

Information for the Public Pdf 345 kb

Scientific Background Pdf 350 kb

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Illustration: Angus Deaton drawing (pdf 1 MB) 
Illustration: Income (pdf 390 kB) 
Illustration: Poverty line (pdf 390 kB)

Angus Deaton, UK and US citizen. Born 1945 in Edinburgh, UK. Ph.D. 1974 from University of Cambridge, UK. Professor of Economics and International Affairs, Princeton University, NJ, USA, since 1983.

http://scholar.princeton.edu/deaton

The Prize amount: 8 million Swedish krona
Further information: http://kva.se and http://nobelprize.org
Contacts: Hans Reuterskiöld, Press Officer, +46 8 673 95 44, +46 70 673 96 50, hans.reuterskiold@kva.se
Jakob Svensson, member of the Committee for the Prize in Economic Sciences in Memory of Alfred Nobel, +46 8 16 30 60, +46 70 177 67 17, jakob.svensson@iies.su.se

The Royal Swedish Academy of Sciences, founded in 1739, is an independent organisation whose overall objective is to promote the sciences and strengthen their influence in society. The Academy takes special responsibility for the natural sciences and mathematics, but endeavours to promote the exchange of ideas between various disciplines.

Bacheli boy from chhattisgarh got IGNITE Award 2015

The Nobel Peace Prize 2015

     

National Dialogue Quartet

Prize share: 1/1

Oslo, 10 October 2015

The Nobel Peace Prize for 2015

The Norwegian Nobel Committee has decided that the Nobel Peace Prize for 2015 is to be awarded to the Tunisian National Dialogue Quartet for its decisive contribution to the building of a pluralistic democracy in Tunisia in the wake of the Jasmine Revolution of 2011. The Quartet was formed in the summer of 2013 when the democratization process was in danger of collapsing as a result of political assassinations and widespread social unrest. It established an alternative, peaceful political process at a time when the country was on the brink of civil war. It was thus instrumental in enabling Tunisia, in the space of a few years, to establish a constitutional system of government guaranteeing fundamental rights for the entire population, irrespective of gender, political conviction or religious belief.

The National Dialogue Quartet has comprised four key organizations in Tunisian civil society: the Tunisian General Labour Union (UGTT, Union Générale Tunisienne du Travail), the Tunisian Confederation of Industry, Trade and Handicrafts (UTICA, Union Tunisienne de l'Industrie, du Commerce et de l'Artisanat), the Tunisian Human Rights League (LTDH, La Ligue Tunisienne pour la Défense des Droits de l'Homme), and the Tunisian Order of Lawyers (Ordre National des Avocats de Tunisie). These organizations represent different sectors and values in Tunisian society: working life and welfare, principles of the rule of law and human rights. On this basis, the Quartet exercised its role as a mediator and driving force to advance peaceful democratic development in Tunisia with great moral authority. The Nobel Peace Prize for 2015 is awarded to this Quartet, not to the four individual organizations as such.

The Arab Spring originated in Tunisia in 2010-2011, but quickly spread to a number of countries in North Africa and the Middle East. In many of these countries, the struggle for democracy and fundamental rights has come to a standstill or suffered setbacks. Tunisia, however, has seen a democratic transition based on a vibrant civil society with demands for respect for basic human rights.

An essential factor for the culmination of the revolution in Tunisia in peaceful, democratic elections last autumn was the effort made by the Quartet to support the work of the constituent assembly and to secure approval of the constitutional process among the Tunisian population at large. The Quartet paved the way for a peaceful dialogue between the citizens, the political parties and the authorities and helped to find consensus-based solutions to a wide range of challenges across political and religious divides. The broad-based national dialogue that the Quartet succeeded in establishing countered the spread of violence in Tunisia and its function is therefore comparable to that of the peace congresses to which Alfred Nobel refers in his will.

The course that events have taken in Tunisia since the fall of the authoritarian Ben Ali regime in January 2011 is unique and remarkable for several reasons. Firstly, it shows that Islamist and secular political movements can work together to achieve significant results in the country's best interests. The example of Tunisia thus underscores the value of dialogue and a sense of national belonging in a region marked by conflict. Secondly, the transition in Tunisia shows that civil society institutions and organizations can play a crucial role in a country’s democratization, and that such a process, even under difficult circumstances, can lead to free elections and the peaceful transfer of power. The National Dialogue Quartet must be given much of the credit for this achievement and for ensuring that the benefits of the Jasmine Revolution have not been lost.

Tunisia faces significant political, economic and security challenges. The Norwegian Nobel Committee hopes that this year's prize will contribute towards safeguarding democracy in Tunisia and be an inspiration to all those who seek to promote peace and democracy in the Middle East, North Africa and the rest of the world. More than anything, the prize is intended as an encouragement to the Tunisian people, who despite major challenges have laid the groundwork for a national fraternity which the Committee hopes will serve as an example to be followed by other countries.