The 2008 sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel has been awarded to US economist and columnist Paul Krugman.
The swedish Royal Academy committee, who awarded the prize, emphasized Krugman's work in bringing together two previously very separate fields of economics, international trade and economic geography.
Krugman's theories explain the effects of free trade and globalization, as well as what lies behind global trends such as urbanization. Traditional trade theory states the countries are different, and so exports different goods and services. Krugman tries to explain why global trade is dominated by countries which have similar conditions and which trade in similar products. Krugman's theory relies on his concept of the economies scale, shich says that many goods and services can be produced cheaply when produced in mass volumes. He also says that consumers demand a wide range of goods. This results in the limiting number of local small scale operations which become replaced by large scale productions for the world market.
Krugman who teaches at Princeton University in New Jersey and serves as a coumnist with the New York Times, has been cited for his analysis of trade patterns and locations of market activity. Krugman earned his Ph.D from the Massachusetts Institute of Technology (MIT) in 1977 and taught at Yale, MIT, UC Berkeley, the London School of Economics, and Stanford University.
Unlike other Nobel Prizes, the economic prize was established in 1968 to celebrate the 300th year anniversary of the Riks Bank. This prize is funded by the Riksbank and the winner is chosen by the Swedish Royal Academy.
