18. TWENTY-FIVE YEARS AFTER THE COUP

What’s has changed in the economy prize?

To recap, aftter two weeks away from the story: The Nobel Memorial Prize in ecomics was established in 1968, by the Royal Swedish Academy of Sciences, as an alternative to depending on government funding. The prize had critics from its beginnings. A no-stings endowment supplied by a gift from the Swedish Central Bank made it possible. Politics shadowed it from the start, despite its shelter in the Science Academy, which awards the physics and chemistry prizes as well. Nobel prizes since 1901. Throughout the second half of the twentieth century, Sweden was experiencing a painful transition from bureaucratic traditions of governance to greater reliance on market forces.

The Economic prize experienced its first overt collision with politics in 1976 when Milton Friedman was recognized for fundamental contributions to monetary economics. After a public outcry, the Academy appointed a committee to study the propriety of the award. A second encounter began eight years later, when a market-oriented member of the prize committee was said to have withheld his vote for MIT’s Robert Solow, until James Buchanan, a little-known public finance theorist from Virginia, was recognized first. (Solow received his award a year after Buchanan.)

Then in 1994, under cover of internal commotion over recognizing the advent of game theory for the first time (the famous prize to John Nash), the Sciences Academy appointed another committee, this time, in Sylvia Nasar’s phrase, “to study the future of the economics prize.”

During the next six years, the Academy made two key changes: it established a term limiter for membership on its prize committee; and it undertook a campaign to diminish the voting power of economists within the Academy section to which all social scientist members are assigned. The campaign involved searching out non-market researchers at a higher rate than economics.

Assar Lindbeck, the economist who has put the economics prize on the map, while supporting time-limits, resigned almost immediately from the committee.He died, at 90, in 2020. Leaders of a rising generation of prize-awarders, were eased out of the Nobel program altogether. In 2002, the Academy changed the name of its Ninth Class, formerly. “Economics, Statistics, and Social Sciences,” to “Social Sciences.”

Economics had been demoted. No longer were it and statistics discipline unto themselves, as are physics and chemistry. To put it differently, the nascent social studies that had emerged during the nineteenth century – sociology, psychology, anthropology, political science, and “science, technology, and society,” to give Marxist studies their modern name – were elevated to a higher plane. All this but the name change unfolded behind closed doors, guarded by the long-standing tradition of Nobel confidentiality.