THE BENEFACTOR

The how and why of the last-minute scramble that enabled the prize

“During 1967 or the first half of 1968,” Assar Lindbeck wrote in his autobiography, Per Åsbrink called one night to say that “he had a new idea” Could part of the Riksbank’s profits be used for a Nobel prize in economics? His specific question was “whether Swedish academic economists could agree on winners without upsetting and infighting? Lindbeck pondered the question and replied that he thought “it might very well work”.

While Lindbeck’s recollection is surely accurate as far as it goes, as an origin story, it doesn’t go very far. When did ambitions for a Nobel prize in economics first arise? Scraps of evidence suggest a date as far back as 1958 – about the same time that Finance Minister Gunnar Sträng began his campaign to punish Per Åsbrink, Governor of Sweden’s central bank his country’s Fed, for having organized his 1957 one percent overnight interest rate hike as a “coup.” We know, thanks much to Gabriel Söderberg, the story of how the Riksbank got the discretionary money, a considerable sum, to endow an economics prize. The story is told in The Nobel Factor, Söderberg’s 2017 book, with Avner Offer.

Thanks to investigative reporter Emanuel Sidea, we know something more about how w Åsbrink’s “new idea” came to fruition. In “The Riksbank’s Unknown Coup,” Sidea chronicled the break-neck adventure by which “a few people, in a few weeks, create a completely new Nobel Prize, his story appeared in Vekans Affärer, the Swedish equivalent of Business Week, in December 2018.