Jean Tirole, a French economist who earned his doctorate at MIT and holds the title of visiting professor there, was awarded the Nobel Prize in Economics Monday for his studies of market power and regulation.
Tirole, 61, a professor at Toulouse School of Economics in France, completed his Ph.D in 1981 and taught at the Massachusetts Institute of Technology from 1984 to 1992. He has frequently collaborated with professors at Harvard and MIT.
Tirole, whose work has spanned several fields of economics, was the sole recipient of the award, which comes with a prize of $1.1. million. The Nobel committee cited his analyses on how monopolies and cartels wield power in the marketplace and how governments respond. Tirole’s research and writings could be a resource for governments that seek to regulate industries where power is concentrated among a few companies, such as telecommunications and banking, the committee said.
“Drawing on these new insights, governments can better encourage powerful firms to become more productive and, at the same time, prevent them from harming competitors and customers,” the Nobel committee said in a statement.
Although Tirole is primarily a theorist, his writings have influenced policy, including regulation of the French electricity sector, said Eric Maskin, a Harvard economics professor who oversaw Tirole’s work on his doctoral thesis. Maskin, who shared an economics Nobel in 2007, said he thought it was only a matter of time before his former student and frequent co-author was recognized.
“I always knew deep down that Jean would win at some point, but there are so many other deserving candidates that you never know exactly when it would happen,” said Maskin. “He’s being cited for his work on regulation of monopolistic and oligopolistic industry, but he’s done so much more.”
Tirole is the first French economist to win the prize since 1988 and the first economist in 30 years to be awarded the prize for studying regulation. In the 1980s and 1990s, Tirole and the late Jean-Jacques Laffont used a branch of mathematics called game theory to explore how regulators could nudge utility companies to be more efficient.
The French economist’s most popular work, a 1988 book called “The Theory of Industrial Organization,” has been cited 12,500 times in academic papers, according to Google Scholar. Tirole’s impact has been broad, influencing studies on the economic impact of financial crises and the rise of open-source software, colleagues said.
“Jean has an almost magical ability to distill down a complex set of facts into a stylized model,” said Josh Lerner, a Harvard professor who has written papers with Tirole.
The economics Nobel has been awarded annually since 1969. Last year, it was shared by Eugene Fama, a University of Chicago professor, Boston native, and Malden Catholic High School alumnus; Lars Peter Hansen, another University of Chicago professor; and Robert Shiller, a Yale University professor who earned his Ph.D at MIT. They were recognized for their work on the efficiency of markets and asset pricing.
Tirole is the first economist since 2009 to be named the sole recipient of the prize.
“It’s more than amply deserved,” said Emmanuel Farhi, a professor of economics at Harvard who has co-authored several papers with Tirole. “He’s revolutionized the field of industrial organization by bringing new tools and thinking.”
Born: Aug. 9, 1953, in Troyes, France.
Education: Mathematics degree from Paris Dauphine University; engineering degrees from Ecole Polytechnique and Ecole Nationale des Ponts et Chaussees; doctorate from Massachusetts Institute of Technology.
Current position: professor at Toulouse School of Economics, visiting professor at the Massachusetts Institute of Technology.
Significance of work: Has influenced how governments deal with mergers or cartels and how they regulate monopolies in industries ranging from telecommunications to banking.
Nobel citation: “For his analysis of market power and regulation.”
Quote: ‘‘I’m so moved.’’