American economist Robert Shiller, namesake of the S&P/Case Shiller housing market index, has won the Nobel prize for economics.
Shiller, a Yale University professor well-known for warning against bubbles in technology stocks and housing, joined fellow economists Eugene Fama and Lars Peter Hansen in winning the Royal Swedish Academy of Sciences’ famous prize.
“A lot of people have told me they hoped I would win it, but I’m aware there are so many other worthy people that I had discounted it, so I would say no, I did not expect it,” he told the Telegraph.
The trio won for collectively advancing the current understanding of asset prices, which the academy said is key to making decisions on savings, house buying and national economic policy.
Fama, regarded as the father of the efficient market hypothesis, showed the difficulty of predicting stock prices in the short run starting in the 1960s. Twenty years later, Shiller showed that there is more predictability in the long run in stock and bond markets, while Hansen devised a statistical method to test asset pricing theories.
All awards, which are distinct from the Nobel Prize created by Swedish industrialist Alfred Nobel in 1895, will be presented on December 10. [Telegraph] — Julie Strickland