Nobel Economics Prize 2026: Robert E Hall, Michael Woodford Win For Macroeconomic Models

American economists Robert E Hall and Michael Woodford won the 2026 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel on Monday for developing macroeconomic models that have strengthened policymakers’ ability to stabilise economies during booms and recessions.

The Royal Swedish Academy of Sciences said their research established a stronger theoretical foundation for fiscal and monetary policies, helping governments and central banks manage economic fluctuations through timely interventions.

Hall of Stanford University and Woodford of Columbia University rebuilt macroeconomic models around microeconomic foundations, examining how households and businesses make decisions and how those choices affect the wider economy. Their work gained significance after the oil shocks of the 1970s, when several advanced economies experienced high inflation, weak growth and rising unemployment.

The crisis prompted criticism of traditional Keynesian economic models. Hall and Woodford demonstrated how models incorporating forward-looking behaviour could strengthen the effectiveness of economic stabilisation policies.

The academy said governments and central banks worldwide now widely use these models to respond to economic downturns and external disruptions.

“The Laureates’ work has provided us with a stable theoretical foundation for the models that are now used by central banks and governments around the world,” said John Hassler, Chair of the Committee for the Prize in Economic Sciences.

Hassler further added that the models had strengthened responses to energy crises and sudden changes in household consumption.

Hall, born in 1943 in Palo Alto, California, earned his PhD from the Massachusetts Institute of Technology in 1967 and is a professor at Stanford University.

Woodford, born in 1955 in Chicopee, Massachusetts, earned his PhD from the same institution in 1983 and is a professor at Columbia University in New York.

The prize carries an award of 12 million Swedish kronor, which the two laureates will share equally.