In honouring foundational elements of economic growth, the 2025 Nobel Prize in economics speaks to the Trumpian trauma roiling the world at present. The individual works of the winners—Joel Mokyr, Philippe Aghion and Peter Howitt—have centred on the importance of innovation and ‘creative destruction’ in powering sustainable economic progress. Their works have powerfully explained how science and technology have been central to growth down the centuries. Together, they remind us that real progress also includes qualitative improvements—creation of new and better jobs, goods and services—that enhance well-being. What makes the award’s focus vital is that it serves as a reminder why Donald Trump’s trade tariffs, which are attempting to bulldoze an era of free-market principles and excellence in scientific research, are detrimental to global growth.
Mokyr’s work, in particular, explains why Trump’s geopolitical enemy of choice, China, is an economic giant whose success would be difficult to replicate anytime soon. One of the economist’s prominent ideas is the distinction between ‘propositional knowledge’ and ‘prescriptive knowledge’, the first being theoretical knowledge and the second that of technique. He has shown that spurts of economic growth, such as during the industrial revolution, are best propelled when the two types of knowledge feed on each other. China, with its vast experienced manufacturing workforce coupled with an institutional drive for research and development, is following the mantra as few nations have in recent decades. Trump’s policies, characterised by economic nationalism and supply chain onshoring, are like bringing a medieval catapult to a drone fight.
The US president’s leadership style may be unpredictable, but Trumpians reason it’s rooted in a kind of creative destruction—destroying the existing order by pushing an America First ideology. While it’s unclear if it can usher in long-term gains outweighing the short-term chaos, what’s certain is that it’s leading to geopolitical instability, fragmented supply chains, and a global institutional upheaval. Creative or not, we are in the initial phases of this destruction process. It’s for India to diversify supply chains, expand markets, usher in regulatory reforms to withstand shocks—and emerge stronger. As they say, resistance is futile but crisis is completely avoidable.
