UCSB Economics is delighted to announce that Finn Kydland has been awarded
the Nobel Prize in Economics, jointly with Professor Edward Prescott of
Arizona State University. The prize was awarded for their research on
business cycles and macroeconomic policy. Kydland joined the UCSB faculty
in July 2004, and holds the Jeff Henley Chair in Economics.
A highly influential component of Kydland's research focuses on the
time-consistency problem in monetary policy: policymakers may wish to
restrain inflation in the long run by raising interest rates, but
political constraints make them reluctant to bear the short-term costs of
doing so. Kydland and Prescott's work in this area has led to a move
towards greater independence of the monetary authorities from the
political process in a number of countries. Kydland's co-author and
co-winner, Edward Prescott, taught at UCSB as a visiting professor in the
Winter of 2004.
Links:
Left to Right: Melvin Oliver (Dean of Social Sciences), Jeff Henley, Finn Kydland, Judy Henley, Peter Kuhn (Economics Department Chair)
