Global Economy Laureate 2017

Assar Lindbeck

Carl Assar Eugén Lindbeck was born on January 26, 1930, in Umeå, Sweden.

He studied economics at the universities of Stockholm and Uppsala. From 1975 to 1995, he was professor of international economics and head of the Institute for International Economic Studies at Stockholm University. His research focuses on the welfare state.

Lindbeck is best known for his insider-outsider theory of the labor market, which he developed in collaboration with Dennis Snower. According to this theory, the employed, the "insiders," are in a privileged position vis-à-vis the unemployed, the "outsiders." This is because companies incur costs whenever they lay off current employees and replace them by hiring new people, since this involves making severance payments and training the new employees, for example. The insider-outsider theory explains why wages do not fall even though the unemployed would be willing to work for less.

Lindbeck played a crucial role in establishing the Swedish Riksbank’s Prize in Economic Sciences in 1968 in memory of Alfred Nobel. Between 1969 and 1994, he was a member of the awards committee in charge of choosing prize winners and served as its chairman from 1980 to 1994.

From 1992 to 1993, he headed up the so-called "Lindbeck Commission," which was established by the Swedish government and tasked with developing reform proposals in light of the economic crisis at the time. Lindbeck is a member of the Royal Swedish Academy of Sciences as well as the Finnish, Danish, and Norwegian academies of science. He also belongs to the American Academy of Arts and Sciences.


Global Economy Prize Laureates 2017