The Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel has been awarded to”

Daniel Kahneman
USA and Israel

“for having integrated insights from psychological research into economic science, especially concerning human judgment and decision-making under uncertainty”

Vernon L. Smith
USA

“for having established laboratory experiments as a tool in empirical economic analysis, especially in the study of alternative market mechanisms”

Both winners are worthy, but I’m particularly pleased about Kahneman, for a number of reasons. His work on a generalisation of expected utility called prospect theory (like much of his stuff, a collaboration with the late Amos Tversky) is very close to my own area of research, and it’s always good for a field to have a Nobel (this is actually the second in this area, the first having gone to Maurice Allais). Also, he’s basically a psychologist rather than an economist and it’s good to see the Prize going outside the inner circle of economics. Finally, he’s very good and a nice guy.