US economist Richard Thaler on Monday won the Nobel Economics Prize for his pioneering work bridging the gap between economics and psychology.
The Economic Nobel, last of the Nobel prizes to be awarded this year, went to him for his work "on understanding the psychology of economy. "
The Sveriges Riksbank (Swedish National Bank) Prize in Economic Sciences in Memory of Alfred Nobel was first awarded in 1969
Thaler who is from the University of Chicago was awarded the prize for his contributions to behavourial economics.
The Nobel committee said Thaler's work shows how human traits affect individual decisions as well as market outcomes.
Speaking about his win, the award giving body said, ""His empirical findings and theoretical insights have been instrumental in creating the new and rapidly expanding field of behavioural economics, which has had a profound impact on many areas of economic research and policy."
In total, Richard Thaler’s contributions have built a bridge between the economic and psychological analyses of individual decision-making
— The Nobel Prize (@NobelPrize) October 9, 2017
The decision making body further added,
Thaler’s research is often cited in marketing literature & his insights help us recognise marketing tricks and avoid bad economic decisions.
— The Nobel Prize (@NobelPrize) October 9, 2017
The Nobel Committee further added, "Richard H. Thaler demonstrated how nudging – a term he coined – may help people exercise better self-control e.g. when saving for a pension."
Speaking by phone to a news conference immediately after he was announced as the prize winner, Thaler said the most important impact of his work is "the recognition that economic agents are humans" and money decisions are not made strictly rationally.
Thaler told the news conference that he will likely use the prize money in ways consistent with his research.
"I will say that I will try to spend it as irrationally as possible," he said.
Outside of academia, Thaler has made a cameo in the movie "The Big Short" to discuss an economic phenomenon known as the "hot hand fallacy" - in which a person's success is seen as a sign he would be successful in other fields - with pop star Selena Gomez.
Asked at the news conference if he thought this observation applied to the U.S president, he said: "As to President Trump, I think he would do well to watch that movie."
Interestingly, the last of the Nobel prizes awarded this year was something of an outlier - Alfred Nobel's will didn't call for its establishment and it honors a science that many doubt is a science at all.
The Sveriges Riksbank (Swedish National Bank) Prize in Economic Sciences in Memory of Alfred Nobel was first awarded in 1969, nearly seven decades after the series of prestigious prizes that Nobel called for.
Despite its provenance and carefully laborious name, it is broadly considered an equal to the other Nobel and the winner attends the famed presentation banquet.
