Professor Jean Tirole from the Toulouse School of Economics in France has been awarded the top prize for economics by a Nobel committee for his work on how to regulate industries that are dominated by a few powerful firms.
Prof. Tirole, who has received a grant from the European Research Council (ERC) and has been involved in multiple EU-funded projects, specialises in game theory, which studies strategic interaction between decision-makers who know that they have an impact on each other. His work means that governments can better encourage powerful firms to become more productive and, at the same time, prevent them from harming competitors and customers.
In an interview following the announcement, Tore Ellingsen, Chairman of the Committee for the Prize in Economic Sciences in Memory of Alfred Nobel, explained the relevance of Prof. Tirole’s work.
Prof. Jean Tirole, recipient of the Sveriges Riksbank Prize in Economic Sciences. © CNRS - C. Lebedinsky
‘We are affected by big firms all the time. Some of those big firms are monopoly providers, of electricity or telecommunication or transport services. The quality of those services and the price that they pay matters to all of us,’ he said.
‘The question is what sort of regulations and competition policy do you want to put in place so that the large and mighty firms will act in society’s best interests.’
EU Commissioner for Research, Innovation and Science, Máire Geoghegan-Quinn, paid tribute to the economist. ‘My congratulations go to Prof. Jean Tirole, who has today been awarded the most prestigious prize for Economic Sciences. He is the third ERC grantee to be a Nobel laureate in this year’s awards. This shows that the ERC is clearly funding the best of the best - researchers who truly push the frontiers of knowledge. Europe is and will remain on the map when it comes to first-class research.’
Commission Vice-President Joaquín Almunia, in charge of competition policy, also recognised the achievement. ‘I wish to warmly congratulate Jean Tirole. He is one of the sharpest economic theorists having contributed to our understanding of market power and how regulation may effectively curb it.’
The ERC President, Prof. Jean-Pierre Bourguignon, also congratulated the laureate and said: ‘We feel encouraged in our work to identify prominent scientists and scholars and fund their pioneering ideas.’
Speaking about his receipt of the award, which includes a EUR 878 000 prize, Prof. Tirole said he was ‘very proud’ and that he had to ask his 90-year-old mother to sit down before he told her the news.
The prize, officially called the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, is not one of the original Nobel prizes, but was set up in 1968 by Sweden’s central bank. It is awarded by the Royal Swedish Academy of Sciences according to the same principles that apply to the Nobel Prizes, in place since 1901.
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