In these situations, a second theory, offered by Kenneth Arrow and Edmund Phelps in the early 1970s, is more useful.

ECONOMIST: Race, sex and the dismal science

Edmund Phelps, who came second with six of 60 entries in a pool of economists run by the author of this article, has made many important contributions to micro- and macroeconomics.

ECONOMIST: Nobel prize in economics

And Edmund Phelps won't have to go far to have a celebratory beer with his fellow 2006 Nobel Laureates because all the Nobel Prizewinners so far this year are Americans, as you may have heard.

NPR: Is the Nobel Sweep Over for Americans?

Edmund Phelps, winner of the 2006 Nobel prize for economics for his work on savings and labour markets, argues that the structural explanation for Europe's slower growth rates masks deeper problems with dynamism.

ECONOMIST: Why can't Europe's economies catch up with America?

"In the 1970s it became respectable to model the economy as if it was a perfectly functioning, self-regulating machine, " says Edmund Phelps, a Nobel Prize winning Professor of Economics at Columbia University in New York.

BBC: A lesson in history

This year's nobel laureate for economics, Edmund S. Phelps, a professor at Columbia, won academic fame for studying the tradeoff between inflation and unemployment, ultimately concluding that there really isn't one.

FORBES: Slick Solution