Kydland, Finn E.

Kydland, Finn E.

(born December 1943, Ålgård, near Stavanger, Nor.) Norwegian economist. Kydland was educated at the Norwegian School of Economics and Business Administration (B.S., 1968) and Carnegie Mellon University in Pittsburgh, Pa. (Ph.D., 1973), where Edward C. Prescott advised him on his doctorate. Kydland, working with Prescott, demonstrated how a declared commitment to a low inflation rate by policy makers might create expectations of low inflation and unemployments rates. They also established the microeconomic foundation for business cycle analyses, showing that technology changes or supply shocks, such as oil price hikes, could be reflected in investment and relative price movements and thereby create short-term fluctuations around the long-term economic growth path. In 2004 Kydland shared the Nobel Prize for Economics with Prescott.