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Joel Mokyr, Philippe Aghion, and Peter Howitt won the Nobel memorial prize in economics Monday for their research into the impact of innovation on economic growth and how new technologies replace older ones, a key economic concept known as “creative destruction.”The winners represent contrasting but complementary approaches to economics. Mokyr is an economic historian who delved into long-term trends using historical sources, while Howitt and Aghion relied on mathematics to explain how creative destruction works.Dutch-born Mokyr, 79, is from Northwestern University; Aghion, 69, from the Collge de France and the London School of Economics; and Canadian-born Howitt, 79, from Brown University.Mokyr was still trying to get his morning coffee when he was reached on the phone by an AP reporter, and said he was shocked to win the prize.“People always say this, but in this case I am being truthfulI had no clue that anything like this was going to happen,” he said.His students had asked him about the possibility he would win the Nobel, he said. “I told them that I was more likely to be elected Pope than to win the Nobel Prize in economicsand I am Jewish, by the way.”Mokyr will turn 80 next summer but said he has no plans to retire. “This is the type of job that I dreamed about my entire life,” he said.Like fellow laureate Mokyr, Aghion also expressed surprise at the honor. “I can’t find the words to express what I feel,” he said by phone to the press conference in Stockholm. He said he would invest his prize money in his research laboratory.Asked about current trade wars and protectionism in the world, Aghion said that: “I am not welcoming the protectionist way in the US. That is not good for world growth and innovation.”The winners were credited with better explaining and quantifying “creative destruction,” a key concept in economics that refers to the process in which beneficial new innovations replaceand thus destroyolder technologies and businesses. The concept is usually associated with economist Joseph Schumpeter, who outlined it in his 1942 book “Capitalism, Socialism and Democracy.”The Nobel committee said Mokyr “demonstrated that if innovations are to succeed one another in a self-generating process, we not only need to know that something works, but we also need to have scientific explanations for why.”Mokyr has long been known as an optimist about the positive effects of technological innovation.In an interview with the AP in 2015, he cited the music streaming service Spotify as an example of an “absolutely astonishing” innovation that economists had difficulty measuring. Mokyr noted he once owned more than 1,000 CDs and, before that, “I spent a large amount of my graduate student budget on vinyl records.” But now he could access a huge music library for a small monthly fee.Aghion and Howitt studied the mechanisms behind sustained growth, including in a 1992 article in which they constructed a mathematical model for creative destruction.Aghion helped shape French President Emmanuel Macron’s economic program during his 2017 election campaign. More recently, Aghion co-chaired the Artificial Intelligence Commission, which in 2024 submitted a report to Macron outlining 25 recommendations to position France as a leading force in the field of AI.“The laureates’ work shows that economic growth cannot be taken for granted. We must uphold the mechanisms that underlie creative destruction, so that we do not fall back into stagnation,” said John Hassler, chair of the committee for the prize in economic sciences.One half of the 11 million Swedish kronor (nearly $1.2 million) prize goes to Mokyr and the other half is shared by Aghion and Howitt. Winners also receive an 18-carat gold medal and a diploma.The economics prize is formally known as the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel. The central bank established it in 1968 as a memorial to Nobel, the 19th-century Swedish businessman and chemist who invented dynamite and established the five Nobel Prizes.Since then, it has been awarded 57 times to a total of 99 laureates. Only three of the winners have been women.Nobel purists stress that the economics prize is technically not a Nobel Prize, but it is always presented together with the others on Dec. 10, the anniversary of Nobel’s death in 1896.Nobel honors were announced last week in medicine, physics, chemistry, literature and peace. Corder reported from The Hague, Netherlands. David McHugh in Frankfurt, Germany, and Chris Rugaber in Washington contributed to this report. Kostya Manenkov and Mike Corder, Associated Press
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E-Commerce
Inflation has risen in three of the last four months and is slightly higher than it was a year ago, when it helped sink then-Vice President Kamala Harris’ presidential campaign. Yet you wouldn’t know it from listening to President Donald Trump or even some of the inflation fighters at the Federal Reserve.Trump told the United Nations General Assembly late last month: “Grocery prices are down, mortgage rates are down, and inflation has been defeated.”And at a high-profile speech in August, just before the Fed cut its key interest rate for the first time this year, Federal Reserve Chair Jerome Powell said: “Inflation, though still somewhat elevated, has come down a great deal from its post-pandemic highs. Upside risks to inflation have diminished.”Yet dismissing or even downplaying inflation while it is still above the Fed’s target of 2% poses big risks for the White House and the Federal Reserve. For the Trump administration, it could find itself on the wrong side of a potent issue: Surveys show that many Americans still see high prices as a major burden on their finances.The Fed may be taking an even bigger gamble: It has cut its key interest rate on the assumption that the Trump administration’s tariffs will only cause a temporary bump up in inflation. If that turns out to be wrong if inflation gets worse or remains elevated for longer than expected the Fed’s inflation-fighting credibility could take a hit.That credibility plays a crucial role in the Fed’s ability to keep prices stable. If Americans are confident that the central bank can keep inflation in check, they won’t take steps such as demanding sharply higher pay when prices rise that can launch an inflationary spiral. Companies often increase prices further to offset higher labor costs.But Karen Dynan, a senior fellow at the Peterson Institute for International Economics, said this week that with memories of pandemic-era inflation still fresh and tariffs pushing up the cost of imported goods, consumers and businesses could start to lose confidence that inflation will stay low.“If that proves to be the case, in hindsight it will be that the Fed cuts and I do expect several more are going to be seen as a mistake,” Dynan said.So far, the Trump administration’s tariffs haven’t lifted inflation as much as as many economists expected earlier this year. And it remains far below its 9.1% peak three years ago. Still, consumer prices increased 2.9% in August from a year earlier, up from 2.6% at the same time last year and above the Fed’s 2% target.The government is scheduled to release the September inflation report on Wednesday, but the data will probably be delayed by the government shutdown.Tariffs have pushed up the cost of many imported items, including furniture, appliances, and toys. Overall, the cost of long-lasting manufactured goods rose nearly 2% in August from a year earlier. It was a modest gain, but comes after nearly three decades when the cost of such items mostly fell.The cost of some everyday goods are still rising more quickly than before the pandemic: Grocery prices moved up 2.7% in August from a year ago, the largest gain, outside the pandemic, since 2015. Coffee prices have soared nearly 21% in the past year, partly because Trump has slapped 50% import taxes on Brazil, a leading coffee exporter, and also because climate change-induced droughts have cut into coffee bean harvests. Most Fed officials are still concerned that inflation is too high, according the minutes of its Sept. 16-17 meeting. Yet they still chose to cut their key interest rate, because they were more worried about the risk of worsening unemployment than about higher inflation.But the concern for some economists is that the ongoing rollout of tariffs and the fact that many companies are still implementing price hikes in response could result in more than just a temporary boost to inflation.“It is a big gamble after what we’ve been going through to count on it being transitory,” said Jason Furman, an economist at Harvard University and a former top adviser to President Barack Obama. “Once upon a time, (3% inflation) would have been considered really high.”Just two weeks ago, Trump slapped new tariffs on a range of products, including 100% on pharmaceuticals, 50% on kitchen cabinets and bathroom vanities, and 25% on heavy trucks. On Friday, he threatened “a massive increase of tariffs” on imports from China in response to that country’s restrictions on rare earth exports.Some companies are still raising prices to offset the tariff costs. Duties on steel and aluminum imports have pushed up the cost of the cans used by Campbell Soups, leading the company’s CEO to say in September that it will implement “surgical pricing initiatives.”Chris Butler, CEO of National Tree Company, the nation’s largest artificial Christmas tree seller, says his company will raise prices by about 10% this holiday season on its trees, wreaths, and garlands to offset tariff costs. About 45% of its trees are made in China, with the rest from Southeast Asia, Mexico, and other countries. The cost of labor and real estate is too high to make them in the United States, he said.Butler also expects there will be a reduced supply of artificial trees and decorations this year, which could lift industry-wide prices further, because most production in China shut down when tariffs on that country hit 145% earlier this year. Production resumed after Trump reduced the duties to 30% but at a slower pace.Butler has pushed his suppliers to absorb some of the cost of the tariffs, but they won’t pay all of it.“At the end of the day, we can’t absorb the entirety of it and our factories can’t absorb the entirety of it,” he said. “So we’ve had to pass along some of the increases to consumers.”Many Fed policymakers are aware of the risks. Jeffrey Schmid, president of the Federal Reserve Bank of Kansas City, who votes on interest rate decisions, said Monday that high inflation that results from a loss of confidence in the central bank is harder to fight than other price spikes, such as those that result from supply disruptions.“The Fed must maintain its credibility on inflation,” Schmid said. “History has shown that while all inflations are universally disliked, not all inflations are equally costly to fight.”Yet some Fed officials say that other trends are offsetting the impact of tariffs. Fed governor Stephen Miran, whom Trump appointed just before the central bank’s September meeting, said Tuesday that a steady slowdown in rental costs should reduce underlying inflation in the coming months. And the sharp drop in immigration as a result of the administration’s clampdown will reduce demand, he said, cooling inflation pressures.“I’m more sanguine about the inflation outlook than a lot of other people are,” he said. Christopher Rugaber, AP Economics Writer
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E-Commerce
Weve spent the better part of the past few years glued to our screensclicking, swiping, streaming. Endless tabs, endless scrolls. And yet, despite all the infinite access, we’re still craving the one thing the web cannot render: real presence. That collective craving has rewritten the rules of marketing. Five years after COVID, brands are finding the antidote to Zoom fatigue by showing up in person again. Canva, the Australian graphic design platform, is moving quickly to meet this demand with the launch of the Canva World Tour, a global initiative spanning 40 cities across 30 countries and five continents, with the goal of training one million people in just a month. The tour features 250 workshops and community-led sessions, from campus pop-ups to hands-on tutorials and certification programs. With a massive online footprint1 in 24 internet users worldwideCanva boasts 240 million monthly active users across 190 countries and 100 languages, generating more than 370 designs every second. Amid a booming online presence, its move to live events is about taking the experience from URL to IRL, Jimmy Knowles, Canva’s global head of experiential, told Fast Company. Its not the first time Canva has embraced face-to-face interactions. This year, Canva Create, the companys annual event, had a tentpole moment with 105 speakers across six stages, drawing more than 4,300 attendees in person at California’s SoFi Stadium, with 6.6 million tuning in online. Knowles describes the events as a chance to be unapologetically ourselves, adding, Tech brands are all straight lines and rounded boxes, as opposed to coloring outside the lines. [Photo: Canva] Experience the economy Canva’s headfirst dive into experiential marketing is perhaps no surprise. As reported by eMarketer, experiential marketing spending has surged past $128 billion, with activity signaling a resurgent comeback above pre-pandemic levels. According to the 2023 Trust Report from live events company Freeman, 77% of consumers say their trust in a brand increases following a live event interaction, and 64% retain positive impressions of brands they engage with in person. Building on insights like this, Canva designed its world tour to connect with people directly on their own terms. This enables us to get super local and relevant to the communities were serving, Knowles explains. Kristine Segrist, Canva’s global head of consumer marketing, adds, Meeting them where they are makes the experience feel immediate and personal. The tour took off at the Texas State Fair in Dallas and will culminate in Sydney, Australia, with a 4,000-person keynote and, according to Canva, a major product announcement.
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