Americans Robert Hall and Michael Woodford win the economics Nobel
Robert Hall and Michael Woodford won the 2026 Nobel economics prize "for microeconomic foundations of macroeconomic stabilisation", the Royal Swedish Academy of Sciences said on Monday (Straits Times, citing Reuters). The Japan Times said it was the last prize announced this year. The Financial Times said their work helped central banks respond to the 2008 financial turmoil, and The Economist called them "New Keynesians".
Their work links what households and firms do to how central banks should stabilise prices and jobs. Central banks, including the Central Bank of Nigeria, use these ideas when they set interest rates.
Interest rates, inflation and the naira all depend on how a central bank reacts to shocks. This is the economics behind those decisions.
Admirers say the prize recognises ideas now used by central banks worldwide.
Critics of the New Keynesian approach say it failed to foresee the 2008 crisis.
The prize is a reminder that policy choices have a theory behind them. Read central-bank statements with that in mind.
DailyDrop Nigeria edition No. 9 · Morning · TUE., OCT. 13, 2026