(WBBM NEWSRADIO) — Douglas Diamond, a professor of finance at the University of Chicago Booth School of Business, woke up Monday to a phone call in the middle of the night from Stockholm, Sweden.
The caller told him he’d won the 2022 Nobel Prize in Economics.
“I did know this was the day that they announced the prize,” Diamond said. “I thought it was probably legit, but you never know. I have some friends with a good sense of humor.”
Diamond and his two colleagues – former Federal Reserve Chair Ben S. Bernanke and Washington University professor Philip Dybvig – received the honor for their research into banking and financial crises.
Considered a founder of modern banking theory, Diamond published two papers in the early 1980s about the vulnerability of banks to rumors of collapse and how governments can prevent that.
“You have to think about what's the initial shock that causes trouble, that's what you have to deal with to get the economy back,” Diamond said during a ceremony at the U of C on Monday. “But if you destroy the entire financial system in the meantime, you're going to have a very hard time recovering.”
Diamond is the 95th scholar associated with the University to receive a Nobel Prize, and the 33rd to receive the Nobel in economics.
When asked how he was going to spend his share of $885,000 in winnings, he jokingly told reporters he was going to buy the Total Market Index Portfolio.
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