Stockholm. The 2008 financial crisis has left deep traces in the global economy. But apparently not only there but also in the traditionally more liberal market Nobel Prize jury. So the prizes were not only reduced but also changed the views on economic praiseworthy work. In order to “tame powerful companies” go there at this year’s Nobel Laureate in Economics, announced Staffan Normark, permanent secretary of the Royal Swedish Academy of Sciences, on Monday the introduction. The world’s highest honor for economists go to Frenchman Jean Tirole “for his analysis of market power and regulation,” said Normark
has the 61-year-old economist from the University of Toulouse “especially made clear how to understand and regulate industries that consist of a few powerful companies. ” ., He was “so touched”, the industry economist Tirole journalists said at the award winners announced
Jury Member Goals Ellingsen explained in the episode, the thought world of the award winner: Businesses should therefore indeed grow to be productive, while less productive companies to displace by the concentration of capital. This would benefit ultimately by competition effects, higher value, lower prices and better quality goods benefits for society as a whole.
Negative effects of quasi-monopolies
But if these companies are too powerful and not regulated, they can also “unwanted effects for society,” he said. So products due to a quasi-monopoly position can be about much more expensive than it justify the cost of production. Even mighty large companies can survive with poor productivity because they can prevent new, better for society and progress competitors from entering the market.
Since the first big wave of deregulation in the mid-1980s Tirole has the knowledge about these mechanisms enriched and developed possible solutions for government and politicians. The Economist is “one of the most influential of the present” to the jury. Before Tirole researchers studied mainly by “universal principles” for “all sectors simultaneously,” such as statutory price caps. Tirole caused a relativization of such ancient wisdom and for a more nuanced picture of markets.
“Tiroles theoretical foundations are now used as the regulation of banks and the telecom industry. That you no longer have to pay such high roaming fees by mobile phone abroad, a practical example is, “said John Hassler, Professor of Economics. “Tirole is also in individual markets, went in ‘and told what to do there exactly. So he’s theorists, but also very practical, “said Hassler. On the question from journalists at this year’s Nobel Prize winner, what had now to do just with the banks in order to prevent economic crises, Tirole, however, said evasively via phone, that just in the banking sector needs to be researched more.
Not entirely apolitical price
This year’s award was not completely apolitical, but for the most part, as a jury member Ellingsen after the announcement. “Both socialists and conservatives are now interested in his theories.” This is about scientific knowledge of reality. Tirole deliver the decision-making politicians and officials merely analyzing means and showed them that the “best regulatory policy must be adapted to the specific conditions in each sector closely.”
The regulation of large corporations is the defining theme of the works of this year’s Nobel Prize winner Jean Tirole economy. 2013, the market researcher Eugene F. Fama, Lars Peter Hansen and Robert J. Shiller were honored for their knowledge about the functioning of the stock markets. The price of the Riksbank of Economics “in memory of Alfred Nobel” not going to Nobel’s will return, but was added in 1969
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(“The Press”, print edition, 10/14/2014)
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