EMBank Chairperson Ekmel Çilingir Reflects on Nobel Prize Insights: Innovation as the Engine of Durable Growth

The announcement of the 2025 Nobel Prize in Economic Sciences has opened an important discussion on the forces that sustain long-term prosperity. For Ekmel Çilingir, Chairperson of European Merchant Bank (EMBank), the laureates' work offers a framework that is both historically grounded and urgently relevant. At a time when economies face mounting uncertainty and rapid technological transition, he argues that the prize "returns our focus to deeper fundamentals: what drives sustainable prosperity, and how can we ensure it continues?"

In his recent analysis, Çilingir begins by emphasising the importance of stepping back from the noise of short-term economic pressures. He writes that the prize "reminds us of the power of patient scholarship, of taking the long view to assess not just how economies grow, but why growth endures across generations." With artificial intelligence and green technologies reshaping the economic landscape, he sees the laureates' contributions as vital to understanding the choices that lie ahead.

A major focus of his commentary is Joel Mokyr's research, which explains why sustained growth is a relatively recent phenomenon despite centuries of invention. "Mokyr's work demonstrates that while invention has occurred throughout history," Çilingir notes, "sustained economic growth is a recent phenomenon." The turning point, according to Mokyr and highlighted by Çilingir, was the fusion of scientific inquiry and mechanical skill that characterised the Industrial Enlightenment. Innovation succeeded not because ideas improved, but because societies learned to connect theory with practice in a way that accelerated productivity.

Çilingir summarises Mokyr's formula for sustained growth as a combination of "a joint evolution of science and technology," a culture open to creative destruction, and institutions that allow competition to flourish while enabling "winners to compensate the losers." These foundations, he argues, still matter today.

The article then turns to the work of Philippe Aghion and Peter Howitt, whose 1992 "creative destruction" model explains how innovation drives macroeconomic growth through firm-level competition. As Çilingir describes it, "Innovations are not mere enhancements. They replace older technologies, displacing incumbents." This process, though disruptive, produces stable economic expansion because it continuously rewards new ideas.

Çilingir underscores the policy implications of this model. Too little competitive churn slows innovation, while too much can impose high social costs. Citing their findings, he notes that "declining business dynamism...is linked to slower productivity growth," a trend seen across advanced economies since the early 2000s. The Nobel Committee's own language reinforces this point, warning that reduced entry, exit and job reallocation rates signal a contraction in creative destruction.

For Çilingir, the overarching message is clear: innovation-led growth must be nurtured. He argues that societies must invest in technical education, promote fair competition, update innovation policies and support workers through economic transition. As he concludes, "The path ahead is one we can shape, if we choose to understand it."

The full article can be read here:
https://www.linkedin.com/pulse/nobel-prize-economics-spotlights-exactly-how-sustains-ekmel-cilingir-hmtyf/

Company Name: European Merchant Bank (EMBank)
Contact Person: Dilek Isik
Email: dilek.isik@em.bank
Country: Lithuania
Address: Pirkliu Klubas, Gedimino 35, 01119, Vilnius, Lithuania
Website: https://em.bank/

European Merchant Bank (EMBank) is a specialised, ECB-licensed bank headquartered in Lithuania with a focus on providing reliable, well-structured banking solutions for businesses and fintechs. The bank offers corporate lending, trade finance, payment services and deposit products designed to support companies as they grow. EMBank combines a strong regulatory foundation with a commitment to responsible banking practices, serving clients across the globe while contributing to Lithuania's financial and economic development.

This release was published on openPR.