How Sweden’s Central Bank uses Alfred Nobel’s name to spread economic inequality.
In September the New York Times featured a “Nobel-Winning Economist” attending Burning Man in The Upshot section. Writer Emily Badger accompanied economist Paul Romer into the dessert to document his experience and explore the potential of Burning Man as a template for the next urban century. While Romer last year was awarded economics’ highest honor, the history of the award is controversial and nearly always misrepresented by economists and journalists.
The award’s official name is The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel and gained Nobel-like prestige only through the strategic appropriation of Alfred Nobel’s name. Unlike the Nobel Prizes for Medicine, Chemistry, Physics, Literature and Peace, which were created by Alfred Nobel in his 1896 will and first awarded in 1901, the prize in Economic Sciences was conceived by Sweden’s central bank in 1968.
For 50 years the award has been a foundation for economic theory that has significantly influenced society at a global level. This influence, Binyamin Appelbaum recently wrote in a New York Times’ editorial, has led to a rise of economics that is “a primary reason for the rise of inequality.” Despite this growing understanding, it is common among economists and journalists to continue the practice of misrepresentation.
The award was created to help legitimize economic doctrine that incentivizes the accumulation of capital over circulation and favors exponential growth regardless of negative impacts on the environment and people. “The Economics Prize has nestled itself in and is awarded as if it were a Nobel Prize. But it’s a PR coup by economists to improve their reputation,” bristles Peter Nobel, great great nephew of Alfred Nobel. “There is nothing to indicate that he would have wanted such a prize.”
From the appropriation of the Nobel name by the Swedish National Bank to the complicity of the Nobel Foundation, Alfred Nobel’s attempt to recognize positive human achievement has been hijacked for half a century. The two Swedish born awards are in direct philosophical conflict and work to confer “an individual an authority which in economics no man ought to possess,” as economist Friedrich Hayek exclaimed upon receiving the award himself.
Journalists like Badger have an opportunity to give economists like Romer, who has lamented the spreading of misinformation, a platform to right the accumulated wrongs of a shadowy agenda. To educate the public and hold Sweden’s institutions accountable. To help economists “get themselves thought of as humble, competent people, on a level with dentists” as economist John Maynard Keynes once opined.
Each year that the five official Nobel Prizes are awarded and the Sveriges Riksbank Prize follows without some form of historical clarification is another year that Sweden’s negative influence on global health and wellbeing goes unchecked. Another year that journalists around the world shirk their responsibility to inform and protect the public.