The 2025 Nobel Prize in Economic Sciences has been awarded to Joel Mokyr, Philippe Aghion, and Peter Howitt for their groundbreaking work on how innovation propels long-term economic growth.

The Royal Swedish Academy of Sciences said their research: “revolutionised our understanding of the forces that make prosperity possible.” Mokyr, an economic historian at Northwestern University in the United States, was recognised for uncovering the cultural and institutional conditions that allowed technological progress to become self-sustaining after centuries of stagnation. His work traces how societies that prize curiosity, openness, and scientific inquiry create the foundations for continual improvement rather than decline.

Aghion of the Collège de France in Paris and Howitt of Rhode Island’s Brown University share the other half of the award for their formalisation of “creative destruction,” a theory first proposed by Joseph Schumpeter and refined by their models to show how innovation constantly replaces older technologies and firms. Their research demonstrated that while such disruption can cause job losses and political resistance, it is also the engine of productivity and rising living standards.

Announcing the R20-million prize, Committee chair John Hassler warned that: “growth cannot be taken for granted” and that societies must preserve the conditions that allow innovators to challenge incumbents. The Academy said the laureates’ work explains both the miracle of modern growth and the policy tensions that threaten it. Their combined insight offers a simple truth with profound consequences: when creativity is stifled, progress stops.