Robert E. Hall and Michael Woodford win 2026 Nobel economics prize
publishers 83articles 89first reported 12 Oct, 05:27 UTCdeveloping since 12 Oct · 10 editionstop 25 #4
US economists Robert E. Hall and Michael Woodford won the 2026 Nobel economics prize on Monday for developing models that help governments and central banks stabilize economies during booms, recessions and other shocks.
The Royal Swedish Academy of Sciences honored the pair “for microeconomic foundations of macroeconomic stabilization.” Hall is a professor at Stanford University, while Woodford teaches at Columbia University.
Their work rebuilt macroeconomic models around the forward-looking decisions of individual households and businesses rather than relying only on statistical relationships among broad measures such as inflation, production and consumption. The academy said the resulting models explain and quantify how fiscal and monetary policies affect business cycles, including how expectations and official communications influence economic behavior.
“The laureates’ work has provided us with a stable theoretical foundation for the models that are now used by central banks and governments around the world,” prize committee chair John Hassler said. He added that the models improve policymakers’ ability to respond to shocks such as energy crises or abrupt changes in household consumption.
Woodford said the framework proved useful after the global financial crisis, when central banks supplemented interest-rate cuts with clearer guidance about the likely future path of monetary policy.
Hall and Woodford will share 12 million Swedish kronor, about $1.2 million. Formally called the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, the award was established by Sweden’s central bank in 1968 and first presented in 1969. It was the final Nobel announcement of 2026.
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