The 2025 Nobel Prize in Economics went to Joel Mokyr, Philippe Aghion, and Peter Howitt for their research on innovation and creative destruction. Their work demonstrates how economies thrive by letting new ideas supplant old ones. For Mexico, it signals the need for a state that drives innovation while safeguarding the social fabric.
The 2025 Nobel Prize in Economics honored Joel Mokyr, Philippe Aghion, and Peter Howitt for showing that economic progress relies on innovation allowing new firms, technologies, and ideas to replace obsolete processes, jobs, and structures. This “creative destruction” concept means advancement is not halted but managed to prevent social harm.
Aghion and Howitt outline a “quality ladder,” where firms invest in innovation to enhance products and processes, capturing market share but displacing rivals and reshuffling jobs. Policies shielding past winners or barring newcomers stall growth. In his book The Power of Creative Destruction, Aghion asks: “how do we achieve creative destruction to generate prosperity without breaking the social fabric?”.
The solution calls for an investor state funding science, education, health, infrastructure, and tech platforms—areas underserved by private sectors—and an insurer state with functional unemployment insurance, training programs, and basic safety nets. Without them, innovation breeds fear and resistance.
Mexico, a leading Latin American entrepreneurial hub with startups in fintech and e-commerce plus growing venture capital, faces the challenge of applying these insights. Nuevo León and Monterrey spearhead nearshoring, advanced manufacturing, and knowledge hubs featuring research parks and tech clusters. Yet, a competition policy is essential to cut regulatory barriers and stop large firms from blocking newcomers.
The Nobel serves as a warning: growth is not assured. Mexico must build a state that invests in innovation and enables competition, turning creative destruction into prosperity, particularly in vibrant areas like Nuevo León.