The Nobel Prize for Economics stays in Chicago again this year -- specifically at the University of Chicago. Today's announcement that Eugene F. Fama and Lars Peter Hansen of the U of C would share the 2013 prize with Robert J. Shiller of Yale University, means that the U of C now has 28 affiliated laureates in Economics. The three honorees will share a cash award of about $1.2 million, but the prize is truly priceless for the honor it confers.
It should be noted that the Economics prize is not one of the original five Nobel Prizes, created by the 1895 will of Alfred Nobel. Instead the prize in economics was separately established and funded in 1968 by the Sveriges Riksbank, the central bank of Sweden, on the 300th anniversary of the bank. Before the 2013 award was announced today, there had been 44 Nobel Memorial Prizes in Economic Sciences, given to 71 individuals.
What makes the University of Chicago a "breeding ground" for Nobel winners? The school is mostly noted as the longtime home of Milton Friedman, whose name is synonymous with free market economics. But not all of the Nobel prizes won by its faculty and alumni were related to Friedman's seminal work. Perhaps the University of Chicago should be known as the home of "free thinking" in the field of economics.
The Nobel Lessons for All of Us
Although each of the prize winners was honored for work done over decades in the profession, it took a long time to achieve this recognition. Perhaps the lesson here is that even for the most brilliant minds, it takes a long time for recognition to appear. Whether you're starting a career, or an investment account, the lessons of patience and persistence will always apply.
None of the prize winners was recognized for following trends; each was an innovator. In hindsight, their theories, now accepted, may not seem so radical. But at the time they were developing their thoughts you can be sure their more traditional colleagues and peers wondered why they were "wasting" their time on such off the beaten path perspectives. So another lesson: it pays to innovate, to take the more creative path.
Also, there's the lesson of the company you keep. If you live and work in an environment of creative, innovative thinking it appears you will have a better chance of developing your thoughts and bringing them to fruition. It's the old "birds of a feather, flock together." Of course, brilliance will shine anywhere, but if you want to give yourself -- or your child -- the best opportunity to succeed, the lesson is to consider the environment for advancement.
And finally, these prize winners were specialists, each in one small area of the science of economics. Each had a hypothesis or theory, which was proved out by intensive research and study -- but they didn't turn the entire world upside down. They worked diligently in their corner of the science of economics -- and they made a difference. Too often we think that an idea must be earth shaking to be important enough to receive recognition. While it's important to set big goals, the lesson from these laureates is to stay focused on your mission.
Make Your Life a Nobel Prize Winner
If it weren't for the prize, the world in general might never have known about these accomplishments. Surely, people in their field would have appreciated their contributions. But their names and faces would not be familiar, they would not make headlines.
For sure, more people will recognize Kim Kardashian and Kanye West than will recognize Eugene Fama, Lars Peter Hansen, and Robert Shiller. Yet there's very little doubt that their prize winning economic contributions to pricing of assets -- including stocks, bonds and housing -- will have a far greater impact on your life than today's pop stars.
So, cheers for the Nobel Prize winners. They will have their moment of fame. But the final lesson for all of is that fame isn't the real reward for accomplishment, or the best measure of success. And that's The Savage Truth.