Edward C. Prescott and Finn E. Kydland Shared 2004 Nobel Prize in Economics for Research on Business Cycles and Macroeconomic Policy
Research Associate Edward C. Prescott and Finn E. Kydland were awarded the Nobel Memorial Prize in Economic Sciences in 2004 for their contributions to the understanding of forces driving business cycle fluctuations and the design of economic policy— work described by the Royal Swedish Academy of Sciences as “of great significance, not only for macroeconomic analysis, but also for the practice of monetary and fiscal policy in many countries.” Their work “offered a common explanation for events that, until then, had been interpreted as separate policy failures, e.g., that economies become trapped in high inflation even though price stability is the stated objective of monetary policy.”
At the time of the award, Prescott was Regents Professor and W. P. Carey Chair in Economics at Arizona State University and an affiliate of the NBER Economic Fluctuations and Growth (EFG) Program. Kydland was University Professor of Economics and Richard P. Simmons Distinguished Professor at Carnegie Mellon University. He became an NBER affiliate in the EFG Program in 2008.
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