Stockholm: Nobel prize for economics was awarded to three economists Ben S. Bernanke, Douglas W. Diamond and Philip H. Dybvig for their ‘research on banks and financial crises’. The Royal Swedish Academy of Sciences in Stockholm made this announcement on Monday. This was the last announcement for the year 2022.

“This year’s laureates in the Economic Sciences... have significantly improved our understanding of the role of banks in the economy, particularly during financial crises. An important finding in their research is why avoiding bank collapses is vital,” the Norwegian Nobel Committee said in a statement.

The work by US-based researchers has been crucial to subsequent research that has enhanced our understanding of banks, bank regulation, banking crises and how financial crises should be managed, the Nobel Committee noted.

Through their theoretical models, Diamond and Dybvig have tried to explain the existence of banks, how their role in society makes them vulnerable to rumours about their impending collapse and how society can lessen this vulnerability. The researchers have also offered a solution to bank vulnerability, in the form of deposit insurance from the government.

BREAKING NEWS:
The Royal Swedish Academy of Sciences has decided to award the 2022 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel to Ben S. Bernanke, Douglas W. Diamond and Philip H. Dybvig “for research on banks and financial crises.”#NobelPrize pic.twitter.com/cW0sLFh2sj
— The Nobel Prize (@NobelPrize) October 10, 2022