Edmund Phelps

Edmund Strother Phelps was born on July 26, 1933, in Evanston, Illinois, the son of Edmund Phelps and Florence (Stone) Phelps. His father worked in advertising at a Chicago bank and his mother was a nutritionist. Both lost their jobs in the Great Depression, an experience that left a lasting mark on their son, who later said he sensed very early in life how much the economy mattered to people.

When he was six the family moved to Hastings-on-Hudson, New York, a creative suburban community that Phelps credited as a major influence. He attended school there from 1939 to 1951 and was an avid trumpet player, playing lead trumpet.

Phelps studied at Amherst College, graduating with a BA in 1955. He went on to Yale University, earning his PhD in 1959 with the thesis "A test for the presence of cost inflation in the United States economy, 1955-1957." His doctoral advisers were James Tobin and Arthur Okun, and he was influenced by William Fellner and Thomas Schelling, as well as by Paul Samuelson. He later counted the philosopher John Rawls, whom he met at Stanford's Center for Advanced Study in the Behavioral Sciences in 1969 and 1970, among his influences.

After completing his doctorate Phelps worked at the RAND Corporation (1959 to 1960) and then at Yale and the Cowles Foundation (1960 to 1966), with a visiting year at MIT in 1962 and 1963. His 1961 paper on the golden rule of accumulation set out the saving rate that maximizes consumption along a sustainable growth path.

At the University of Pennsylvania (1966 to 1971) he published "Phillips Curves, Expectations of Inflation and Optimal Unemployment over Time" in Economica (1967) and "Money-Wage Dynamics and Labor Market Equilibrium" in the Journal of Political Economy (1968). These papers introduced the expectations-augmented Phillips curve and the natural rate of unemployment, showing that inflation can only hold unemployment below its natural level temporarily. A January 1969 conference he organized led to the 1970 book Microeconomic Foundations of Employment and Inflation Theory, widely known as the Phelps volume.

Phelps joined Columbia University in 1971 and remained there for more than 50 years. He was McVickar Professor of Political Economy from 1982 to 2021 and professor emeritus from 2022. In 1972 he published work on statistical discrimination and the book Inflation Policy and Unemployment Theory, which explored hysteresis. His 1977 paper with John B. Taylor on staggered contracts helped found New Keynesian macroeconomics. Later books included Political Economy (1985), The Slump in Europe (1988, with Jean-Paul Fitoussi), Structural Slumps (1994), Rewarding Work (1997), Mass Flourishing (2013), Dynamism (2020, with Raicho Bojilov, Hian Teck Hoon and Gylfi Zoega) and The Great Economic Slowdown (2023, with Hoon and Zoega).

In 2001 he founded the Center on Capitalism and Society at Columbia with Roman Frydman and directed it for more than two decades. He took part in a European Bank for Reconstruction and Development mission to Moscow with Kenneth Arrow in 1990 and 1991, sat on the EBRD's advisory board until 1993, advised Italy's National Research Council from 1997 to 2000, and was dean of the New Huadu Business School at Minjiang University in Fuzhou, China, from 2010 to 2016.

Phelps met Viviana Montdor, an Argentine-born interpreter from Buenos Aires who then had a clerical job in Columbia's economics department, in early 1972. They married in 1974, and he helped raise her two children, Monica and Eduardo. He had seven step-grandchildren. Publications often noted that despite his accomplishments he never owned a car. He loved music, particularly jazz, a passion that went back to his trumpet playing as a boy, and he enjoyed fine wine.

Phelps resisted easy ideological labels. He said that if a proposition was correct and he could make a good theoretical argument for it, he did not care whether it was considered left or right. He championed policies such as wage subsidies for low-wage work, set out in Rewarding Work (1997), and argued in Mass Flourishing that the deepest value of a modern economy lies in the personal growth, engagement and meaningful work that grassroots innovation makes possible.

He wrote in 2008 that Keynes had no sure cure for slumps. In 2017 he told Der Spiegel that Donald Trump's economic policy resembled economic policy in a time of fascism, and in June 2024 he was one of 16 Nobel laureates in economics who signed a letter warning about the economic consequences of a second Trump term. In October 2024 he shared a letter from Nobel laureates endorsing Kamala Harris for president.

Phelps is regarded as one of the giants of modern macroeconomics. His natural rate hypothesis, developed independently of Milton Friedman, changed how economists and central bankers understand the relationship between inflation and unemployment and helped explain the stagflation of the 1970s. It underpins the modern practice of central banks targeting low and stable inflation and paying close attention to inflation expectations.

His insistence on grounding macroeconomics in the behavior of individual workers and firms, with imperfect information, helped launch the microfoundations movement. His work on the golden rule of saving, statistical discrimination, hysteresis and staggered wage setting each became a standard part of economics teaching. In his later career he broadened economics to questions of innovation, dynamism and the good life, and through the Center on Capitalism and Society he brought scholars and policymakers together for more than twenty years. Columbia University called him a visionary and a lifelong Columbian.

Phelps received the Nobel Memorial Prize in Economic Sciences in 2006, as sole laureate, for his analysis of intertemporal tradeoffs in macroeconomic policy. His other honours included a Guggenheim Fellowship (1978), election to the National Academy of Sciences, designation as a Distinguished Fellow of the American Economic Association (2000), Chevalier of the Legion of Honour (2008), the Kiel Institute's Global Economy Prize (2008), the Pico della Mirandola Prize (2008), China's Friendship Award (2014) and Yale's Wilbur Lucius Cross Medal (2014). He received honorary doctorates from institutions including Amherst College, the University of Mannheim, NOVA University Lisbon, Paris Dauphine, the University of Iceland, Sciences Po, the University of Buenos Aires, Tsinghua University, the Free University of Brussels and Rome Tor Vergata.

Phelps wrote or edited 24 books. Highlights include Microeconomic Foundations of Employment and Inflation Theory (1970), Inflation Policy and Unemployment Theory (1972), Political Economy: An Introductory Text (1985), The Slump in Europe (1988), Structural Slumps (1994), Rewarding Work (1997), Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change (2013), Dynamism: The Values That Drive Innovation, Job Satisfaction, and Economic Growth (2020), The Great Economic Slowdown (2023) and his memoir My Journeys in Economic Theory (Columbia University Press, 2023), which the Financial Times named among the best economics books of the year. He gave many public lectures, including at Google, the RSA and the Lindau Nobel Laureate Meetings, and was active on X as @EdmundPhelps.

Edmund Phelps died on Friday, May 15, 2026, at his home in Manhattan, New York City, at the age of 92. His wife, Viviana Phelps, said the cause was Alzheimer's disease. Columbia University published an in memoriam tribute on May 19, 2026, and obituaries appeared in The New York Times, the Financial Times and other outlets around the world. His resting place has not been made public.