The 2018 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel has been awarded to William Nordhaus and Paul Romer. They have been granted this prestigious prize for the following works: “for integrating climate change into long run macroeconomic analysis” for Nordhaus and “for integrating technological innovations into long-run macroeconomic analysis." F for Romer. It has a great symbolic as it proves the acknowledgment of a possible sustainable and long-term economic growth. It represents a great victory as it will probably have impacts over governments’ policies, corporate strategies and civil society. Not only the environment needs to be preserved but protecting it does not mean giving up on economic growth, quite the opposite.
Thus Romer’s model called endogenous growth theory shows how the relationship between economic forces and technological innovation is simultaneous. Concerning Nordhaus, its work allows to simulate how economic growth and climate change co-evolve including resilience to shocks like new policies ( e.g carbon taxes ).
Now their findings have put in broad day light and worldly recognized, we can only hope it will have impacts on every economic spheres.
