Nobel Laureate in Economics: "AI Competition Without Suppressing Competitors," Ha Joon-kyung's "AI Economic Reward"
Professor Philippe Agion, co-winner of the Nobel Prize in Economics, argued at a press conference that "competitive policies are necessary to prevent AI innovators from suppressing competitors," opposing Korea's "competitive suppression policy through investment capital." The Nobel Committee cited "a science-based, open society" as its reason for the award.
Ha Joon-kyung, a senior economics professor and a disciple of co-winner Professor Huwit (Brown University), stated in a domestic media interview regarding the Nobel Prize announcement, "Success or failure depends on how systems and policies design appropriate incentives for technological innovation."
He added, "Ensuring appropriate competition and managing innovation to prevent it from leading to monopolies is crucial," and proposed a "policy of incentivizing and rewarding companies" based on an "investment-first strategy."
On the other hand, Professor Agion, the winner, stated in a New York Times interview that "those who invest time and money in knowledge are rewarded with patents and peer recognition," adding that "this system demands a 'government that prioritizes science and technology,'" and that "those things are no longer as self-evident as they once were." This led to a significant gap in the "patent and peer recognition rewards" perspective.
Chief Secretary Ha then highlighted "balance" as a crucial element in technological innovation policy, stating, "If technological innovation becomes monopolized by specific companies, it will subsequently stall." He added, "Sustained technological advancement is only possible with appropriate competition, and openness in education and opportunity is key to this," highlighting the government-led category of "education and opportunity openness."
Professor Agion, on the other hand, defined "openness as the driving force of growth" as a "total open structure." At a press conference in Stockholm, Nobel Committee member Kerstin Enflo said of the laureates' research, "We should not take progress for granted. Instead, society should focus on what creates and sustains economic growth."
The Lee Jae-myung administration implemented a "winner-takes-all" system in its "Sovereign AI" initiative, and Chief AI Secretary Ha Jung-woo is spearheading the "AI powerhouse" initiative by selecting "five" candidates from the competitive selection process and monopolizing the prize money in his "competitiveness enhancement strategy."
The "economic incentives" that Chief Economic Secretary Ha refers to are derived from a bureaucrat-led command economy driven by "winner-takes-all" policies, with bureaucrats exercising full authority over selection.
Regarding the economics prize, Enflo said, "This is a society open to science-based innovation, creative destruction, and change."
Professor Philippe Aghion (Collège de France, INSEAD, and the London School of Economics) shared half the prize with Professor Peter Howitt of Brown University for their research on how innovation drives economic growth.
Professor Agion said in a New York Times press conference that “those who invest time and money in knowledge are rewarded with patents and peer recognition, a system that demands ‘governments that prioritize science and technology,’” adding that “those things are no longer as self-evident as they once were.”
He added that “openness is the engine of growth,” and that “clouds are gathering here,” on the 13th. He continued, “Given the threats to economic growth, companies will not ‘voluntarily’ pursue green growth, so innovation to support green growth is needed.”
At the same time, he said, “AI has ‘fantastic’ growth potential, but we need competition policies to ensure that AI innovators do not stifle competitors.” Professor Agion told the New York Times that “forces like protectionism and tariffs are obstacles to growth,” adding that “trade barriers and deglobalization further fragment markets and reduce opportunities for the exchange of ideas.” He added that “openness is the engine of growth,” and that “I do not welcome a wave of protectionism in the United States.”
He also urged European countries to encourage their own high-tech innovations rather than allowing the United States and China to become the sole global technological leaders.
Joel Mokyr, a professor at Northwestern University who received half the prize, is an American-Israeli who teaches at Tel Aviv University in Israel. He won for his work explaining “how sustained economic growth became the norm.”
The New York Times said, “He showed that for innovation to be successful and self-generating, people need scientific explanations for why breakthroughs work. His work, such as ‘The Culture of Growth: The Origins of the Modern Economy,’ also emphasized the importance of societies being open to new ideas and allowing for change.”
The Nobel Committee stated in its decision to award him the prize that day, "Before the Industrial Revolution, this knowledge was lacking, making it difficult to build on new discoveries."
Professor Mokyr said, "Innovation can solve two of the world's greatest challenges: climate change and an aging population."
He added, "For this innovation to occur, governments must foster science and create an environment where the best and brightest can do their jobs, including through immigration."
He continued, "In my view, any policy that hinders immigration at any level is detrimental to our hopes for continued innovation and progress."
Professor Mokyr expressed optimism about the prospects for further economic growth because of "humanity's ability to manipulate and harness the forces of nature to suit our needs."
He continued, "Through science, our understanding of how to effectively use the laws of nature is improving, and humanity's ability to discover new phenomena is leading to all sorts of things we never dreamed of before, including artificial intelligence, mRNA, and genetic engineering."
The New York Times reported, "The Nobel Prize for the economists' research comes as artificial intelligence becomes an increasingly dominant force in the global economy, with the potential to spur another technology-driven boom."
However, other policies, such as the Trump administration's tariffs and China's protectionist restrictions on exports of rare earth minerals and battery manufacturing equipment, are also expected to stifle economic growth, and the Nobel laureates have warned against policies that could hinder growth, such as immigration restrictions and trade barriers.
Ha Jun-woo, a former student of co-winner Professor Howitt (Brown University), described "creative destruction" in an interview with News 1 as "a process of innovation that creates better technology than existing technologies," adding, "It can only be realized when companies' profit-seeking motives are aligned with institutions and policies." Senior Secretary Ha stated, "With Korea entering a period of stagnant growth, this award sends a clear message: 'Innovation is key to reviving growth.'" He added, "Corporate innovation must be actively promoted, and this requires appropriate systems and policies," calling it a "government-led economic reward."
The Chosun Ilbo reported the award under the headline, "Three Scholars Win Nobel Prize in Economics for Research on Innovative Growth."
Yonhap News reported the award under the headline, "Three Scholars Win Nobel Prize in Economics for Research on 'How Innovation Leads to Sustainable Growth.'"
Kyunghyang Shinmun reported the award under the headline, "Nobel Prize in Economics for Research on 'Sustainable Growth through Technological Progress.'"
News 1 reported the award under the headline, ""A Message to Korea, Where Growth Has Stalled"... Senior Secretary Ha Jun-kyung's Perspective on the Nobel Prize Winners in Economics," with the subheadings, "Senior Secretary Ha: 'I hope my mentor Howitt's ideas are implemented in policy and benefit the world,'" and "If the cycle of innovation is broken, growth also stops... Systems and policies must be made more flexible."
The Lee Jae-myung administration announced on June 27 a policy of "building a self-reliant domestic AI ecosystem by expanding private autonomy," while lining up technology companies in front of bureaucrats through a "competitive support system" in the development of an "Independent AI Foundation Model" to secure domestic AI technology sovereignty.
The policy spearheaded by Chief Ha is a reenactment of Park Chung-hee's highly compressed, "bureaucratic development economy" policy, which involved the government evaluating performance "on a six-month basis" within a corporate competitive system through "public usage evaluations," "offline contests," and "expert utilization evaluations."
Subordinate bureaucratic agencies were ranked based on scores, and provided "up to 1,000 H100 GPUs and 500 B200 GPUs." The policy also involved "first- and second-year leases" and "third- and fourth-year purchases." The government even designated the selected teams as the "elite team model," naming them the "K-AI Model," and simultaneously implemented the chaebol-supporting economic model, which supports their entry into international markets.
This competitive system, funded by government funds, has a total project cost of 25 billion won over three years, with annual support of 1 to 2 billion won per project.
The system aims to become a leader in specialized categories such as "national research and development (R&D) projects," shifting from "surviving the bureaucracy" to "competing to eliminate competitors." Director Jang Ki-cheol of the Ministry of Science and ICT, the competent ministry, stated, "AI is now the core of competition not only between companies but also between nations," adding, "The government has established a system that provides packaged support for GPU purchases, data acquisition, and talent development to secure technological sovereignty and expand the AI ecosystem."
See <Lee Jae-myung Administration's AI Project 'Lines Up Companies' Through Excessive Promotion and Investment Competition in AI, June 27, 2025>
<Lee Jae-myung Administration's "Free Provision of SK Data Public Information" in the "AI Democracy Crisis" Issue, July 5, 2025>
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