They mapped path of growth, Pg13.

Key Highlights:

• The 2025 Nobel Prize in Economic Sciences was awarded to Joel Mokyr, Philippe Aghion, and Peter Howitt for explaining innovation-driven economic growth.
• Mokyr was awarded half of the 11 million Swedish kronor prize money, while Aghion and Howitt will share the remaining half.
• Mokyr's work uses historical sources to identify the causes of sustained economic growth.
• Aghion and Howitt developed a mathematical model analyzing how firm-level decisions lead to national economic growth.

Detailed Insights:

• Mokyr's research highlights the shift from "prescriptive" knowledge to "propositional" knowledge during the Scientific Revolution as a key driver of sustained growth.
• Mokyr emphasized that a society's openness to "creative destruction" is crucial for accepting the changes brought about by technological advancements.
• Aghion and Howitt's model demonstrates how firm-level innovation and competition, driven by patents and R&D investment, contribute to macroeconomic growth.
• The Aghion-Howitt model incorporates the interplay between production, R&D, financial markets, and household savings to achieve "general equilibrium".
• The laureates' work informs current debates on government subsidies for R&D and the creation of social safety nets to maintain societal openness to change.

Key Concepts Involved:

• Creative Destruction: The process where innovation leads to the displacement of old technologies and industries with new ones.
• General Equilibrium: A state in which all markets in an economy are simultaneously in balance.
• R&D (Research and Development): Activities undertaken by companies or governments to innovate and introduce new products and services.