2014 Nobel Prize in Economics awarded for analysis of market power and regulation

The 2014 Nobel Prize for Economics was awarded to French economist Jean Tirole in recognition of his analysis of market power and regulation. Tirole chairs the board of the Jean-Jacques Laffont Foundation at the Toulouse School of Economics and is the scientific director of the Industrial Economics Institute (IDEI) in Toulouse. In the press release announcing the laureate, Tirole is described as “one of the most influential economists of our time.” His theories have helped in paving ways to regulate powerful firms that can otherwise exercise their monopoly, producing many socially undesirable results such as inflation.

Tirole, the University of Toulouse professor, has been studying industrial organization, game theory, banking and finance, and economics, and has published a series of articles and books that advocate “incentive regulation” that encourages companies to be as efficient as they can while sharing some of the gains they make with consumers. From mid-1980s, he has been researching market failures and has come up with policies for governments on dealing with mergers and regulating monopolies, and these theories have been adopted worldwide to regulate market competition. Tirole’s policies are applicable to various industries ranging from banking to telecommunications.

Congratulations to Mr. Tirole!

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