US economists win Nobel prize for analysing the impact of global shocks

AMERICANS Thomas Sargent and Christopher Sims shared the 2011 Nobel Prize for Economics yesterday for providing ways to understand the impacts of policy changes or shocks like surging oil prices on output, inflation or employment.

Sims, from Piinceton University, said their methods were “essential to finding our way out of this mess” which the global economy is now in.

The Royal Swedish Academy of Sciences, which awarded the €1.1 million prize, said it recognised their “empirical research on cause and effect in the macroeconomy” and said their work laid the foundation for modern macroeconomic analysis.