STOCKHOLM, Oct 11 (AFP) - This year's winners of the Nobel Economics Prize, Finn E. Kydland and Edward C. Prescott, were honored for their groundbreaking business cycle research that has helped reform monetary policy in numerous countries.
Finn E. Kydland was born in Norway in 1943, and although he has worked and taught in the United States since the 1970s he remains a Norwegian citizen.
Currently a professor at the Carnegie Mellon University in Pittsburgh and at the University of California in Santa Barbara, Kydland studied economics at the Norwegian School of Economics and Business Administration in Bergen before earning his PhD from the Carnegie Mellon University in 1973.
In two groundbreaking articles written with Edward Prescott in 1977 and in 1982, Kydland showed that economic policymakers who have said they are in favor of low inflation but who cannot commit to a rule in advance will often inadvertently conduct a policy that will cause high inflation.
An economic cycles specialist and an expert on political fiscal and monetary policy and on labor economics, Kydland has been a fellow at the Econometric Society since 1992.
In 1973 he won the Alexander Henderson Award and in 1982-83 he was awarded the John Stauffer National Fellowship by the Hoover Institution.
Edward C. Prescott was born in Glen Falls, New York, in 1940. He is currently a professor at Arizona State University and a researcher at the Federal Reserve Bank of Minneapolis.
Like Kydland, Prescott earned his PhD at the Carnegie Mellon University in Pittsburgh, where he also landed his first professorship in economics in 1975.
In 1980, he was appointed senior advisor to the research department of the Federal Reserve Bank of Minneapolis, and also was hired as an economics professor at the University of Minnesota, where he remained until 1998.
For the next year, Prescott taught at the University of Chicago before returning to the University of Minnesota in 1999, where he continued to teach until 2003.
Since then, he has worked as the senior monetary advisor to the Federal Reserve Bank of Minneapolis and as an economics professor at Arizona State University.
His research spans many areas, including business cycles, economic development, general equilibrium theory and finance, and has addressed some of the most important long-standing questions in economics.
Prescott has won a number of prestigious awards and honors over the years, including winning a Guggenheim fellowship in 1974-75, becoming a fellow at the Econometric Society in 1980 and of the American Academy of Arts and Sciences in 1992. He also became an honorary economics laureate at the University of Rome and won the Erwin Plein Nemmers Prize in Economics in 2002.