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Joel Mokyr, Philippe Aghion and Peter Howitt won the Nobel memorial prize in economics Monday for their research into the impact of innovation on economic growth and how new technologies replace older ones, a key economic concept known as "creative destruction."

The winners represent contrasting but complementary approaches to economics. Mokyr is an economic historian who delved into long-term trends using historical sources, while Howitt and Aghion relied on mathematics to explain how creative destruction works.

Dutch-born Mokyr, 79, is from Northwestern University; Aghion, 69, from the Collège de France and the London School of Economics; and Canadian-born Howitt, 79, from Brown University.

Mokyr was still trying to get his morning coffee when he was reached on the phone by an AP reporter, and said he was shocked to win the prize.

"People always say this, but in this case I am being truthful—I had no clue that anything like this was going to happen," he said.

His students had asked him about the possibility he would win the Nobel, he said. "I told them that I was more likely to be elected Pope than to win the Nobel Prize in economics—and I am Jewish, by the way."

Mokyr will turn 80 next summer but said he has no plans to retire. "This is the type of job that I dreamed about my entire life," he said.

Like fellow laureate Mokyr, Aghion also expressed surprise at the honor. "I can't find the words to express what I feel," he said by phone to the press conference in Stockholm. He said he would invest his prize money in his research laboratory.

Asked about current trade wars and protectionism in the world, Aghion said that: "I am not welcoming the protectionist way in the US. That is not good for ... world growth and innovation."

The winners were credited with better explaining and quantifying "creative destruction," a key concept in economics that refers to the process in which beneficial new innovations replace—and thus destroy—older technologies and businesses. The concept is usually associated with economist Joseph Schumpeter, who outlined it in his 1942 book "Capitalism, Socialism and Democracy."

The Nobel committee said Mokyr "demonstrated that if innovations are to succeed one another in a self-generating process, we not only need to know that something works, but we also need to have scientific explanations for why."

Mokyr has long been known as an optimist about the positive effects of technological innovation.

In an interview with the AP in 2015, he cited the music streaming service Spotify as an example of an "absolutely astonishing" innovation that economists had difficulty measuring. Mokyr noted he once owned more than 1,000 CDs and, before that, "I spent a large amount of my graduate student budget on vinyl records." But now he could access a huge music library for a small monthly fee.

Aghion and Howitt studied the mechanisms behind sustained growth, including in a 1992 article in which they constructed a mathematical model for creative destruction.

Aghion helped shape French President Emmanuel Macron's economic program during his 2017 election campaign. More recently, Aghion co-chaired the Artificial Intelligence Commission, which in 2024 submitted a report to Macron outlining 25 recommendations to position France as a leading force in the field of AI.

"The laureates' work shows that economic growth cannot be taken for granted. We must uphold the mechanisms that underlie creative destruction, so that we do not fall back into stagnation," said John Hassler, chair of the committee for the prize in economic sciences.

One half of the 11 million Swedish kronor (nearly $1.2 million) prize goes to Mokyr and the other half is shared by Aghion and Howitt. Winners also receive an 18-carat gold medal and a diploma.

The economics prize is formally known as the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel. The central bank established it in 1968 as a memorial to Nobel, the 19th-century Swedish businessman and chemist who invented dynamite and established the five Nobel Prizes.

Since then, it has been awarded 57 times to a total of 99 laureates. Only three of the winners have been women.

Nobel purists stress that the economics prize is technically not a Nobel Prize, but it is always presented together with the others on Dec. 10, the anniversary of Nobel's death in 1896.

Nobel honors were announced last week in medicine, physics, chemistry, literature and peace.

Nobel committee announcement:

The Royal Swedish Academy of Sciences has decided to award the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2025 to Joel Mokyr, Philippe Aghion and Peter Howitt

"for having explained innovation-driven economic growth"

with one half to

Joel Mokyr, Northwestern University, Evanston, IL, U.S.

"for having identified the prerequisites for sustained growth through technological progress"

and the other half jointly to

Philippe Aghion, Collège de France and INSEAD, Paris, France, The London School of Economics and Political Science, UK

Peter Howitt, Brown University, Providence, RI, U.S.

"for the theory of sustained growth through creative destruction"

They show how new technology can drive sustained growth

Over the last two centuries, for the first time in history, the world has seen sustained economic growth. This has lifted vast numbers of people out of poverty and laid the foundation of our prosperity. This year's laureates in economic sciences, Joel Mokyr, Philippe Aghion and Peter Howitt, explain how innovation provides the impetus for further progress.

Technology advances rapidly and affects us all, with new products and production methods replacing old ones in a never-ending cycle. This is the basis for sustained economic growth, which results in a better standard of living, health and quality of life for people around the globe.

However, this was not always the case. Quite the opposite—stagnation was the norm throughout most of human history. Despite important discoveries now and again, which sometimes led to improved living conditions and higher incomes, growth always eventually levelled off.

Joel Mokyr used historical sources as one means to uncover the causes of sustained growth becoming the new normal. He demonstrated that if innovations are to succeed one another in a self-generating process, we not only need to know that something works, but we also need to have scientific explanations for why. The latter was often lacking prior to the industrial revolution, which made it difficult to build upon new discoveries and inventions. He also emphasised the importance of society being open to new ideas and allowing change.

Philippe Aghion and Peter Howitt also studied the mechanisms behind sustained growth. In an article from 1992, they constructed a mathematical model for what is called creative destruction: when a new and better product enters the market, the companies selling the older products lose out. The innovation represents something new and is thus creative. However, it is also destructive, as the company whose technology becomes passé is outcompeted.

In different ways, the laureates show how creative destruction creates conflicts that must be managed in a constructive manner. Otherwise, innovation will be blocked by established companies and interest groups that risk being put at a disadvantage.

"The laureates' work shows that economic growth cannot be taken for granted. We must uphold the mechanisms that underly creative destruction, so that we do not fall back into stagnation," says John Hassler, Chair of the Committee for the prize in economic sciences.

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