Former Princeton professor Michael Woodford wins Nobel Prize in Economics

Economist and former Princeton professor Michael Woodford was awarded the 2026 Nobel Memorial Prize in Economic Sciences for contributions to the “microeconomic foundations of macroeconomic stabilization,” according to the prize committee’s announcement. The prize was presented by the Royal Swedish Academy of Sciences in Stockholm Monday morning.

Woodford, currently a professor at Columbia University, shared the prize with Stanford professor and economist Robert E. Hall. They are the 58th recipients of the Nobel Prize in economics, and Woodford is the 19th Princeton affiliate to win in the economics category. 

The two professors were recognized for their work in developing New Keynesian models that helped policymakers understand how to smooth out economic peaks and troughs, which the prize jury said has allowed “well-timed fiscal and monetary policy measures.”  

“The laureates’ work has provided us with a stable theoretical foundation for the models that are now used by central banks and governments around the world,” John Hassler, chair of the Committee for the Prize in Economic Sciences, said during the prize announcement. “With them, we are better equipped to deal with shocks in the economy, such as energy crises or sudden changes in how much households consume.”  

From 1995 to 1998, Woodford was a professor at Princeton’s Department of Economics and held the Harold H. Helm ’20 Professor of Economics and Banking from 1998 to 2004. Woodford was on leave from 2002 to 2003, during which he was a visitor at the Federal Reserve Board of Governors’ Division of Monetary Affairs and held visiting positions at Harvard and the European Central Bank.

He resigned in 2004 to accept the John Bates Clark Professor of Political Economy position at Columbia University, where he now teaches macroeconomic theory in monetary policy and was the chair of the economics department from 2022–2025. 

Woodford and the University did not respond immediately to a request for comment.

Born in Massachusetts in 1950, Woodford received a B.A. from the University of Chicago in 1977 and a J.D. from Yale Law School in 1980 before completing his Ph.D. in economics from MIT in 1983. Woodford was a visiting fellow in Princeton’s economics department in Fall 1983. He held teaching positions at Columbia University and the University of Chicago prior to joining the Princeton faculty in 1995 and was later awarded a Guggenheim Fellowship for his work in economics in 1998. 

Woodford is best known for his treatise, “Interest and Prices: Foundations of a Theory of Monetary Policy,” which received the 2003 Association of American Publishers Award for Best Professional/Scholarly Book in Economics.

The treatise, which argues that central banks should conduct monetary policy by managing interest rates rather than controlling the supply of money, is widely considered a leading reference for monetary theory. Woodford’s treatise was characterized as “the most important book in monetary theory in at least two decades,” according to a review of the book by Kenneth Rogoff, the former Director of Research at the International Monetary Fund. 

Woodford was one of the first MacArthur “Genius Grant” recipients, and his other awards include the Deutsche Bank Prize in 2007; the Banque de France/Toulouse School of Economics Prize in Monetary Economics in 2018; and the Erwin Plein Nemmers Prize in Economics in 2024. 

Woodford, calling in to the Prize announcement from New York City, said he was “elated” and called the prize a “tremendous honor.” He and Hall will split a monetary award of 12 million Swedish kronor, about $1.2 million. 

Princeton congratulated Woodford on X, and Bocconi University professor Dmitriy Sergeyev, one of Woodford’s Ph.D. advisees at Columbia, called him “a brilliant economist and an extraordinarily generous teacher” on X.    

Recent Nobel laureates with Princeton affiliations include former assistant professor Anne Carson, who won the 2026 Nobel Prize in Literature last week, as well as Mary Brunkow GS ’91 (Physiology or Medicine, 2025) and Physics professor emeritus John Hopfield (Physics, 2024). The last time a Princeton affiliate won the Economics prize was in 2023, when former assistant professor Claudia Goldin won “for having advanced our understanding of women's labor market outcomes.” 

Monday’s announcement marks the sixth and last Nobel Prize of the 2026 cycle.  

Sena Chang is the associate News editor for the ‘Prince’ leading investigations. She is from Japan and South Korea, and she often covers local politics and student life. She can be reached at sena[at]dailyprincetonian.com.

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