Reports From the [Associated Press][Reuters]:

By The Associated Press
STOCKHOLM, Sweden (AP, Oct 14) -- Amartya Sen, a scholar from India whose work produced a new understanding of the catastrophes that plague society's poorest people, won the Nobel Economics Prize today.

Sen (whose first name is pronounced Ah-MAR-tya) was awarded the prestigious prize for his contributions to welfare economics, which help explain the economic mechanisms underlying famines and poverty, the Royal Swedish Academy of Sciences said.

``I was surprised and quite pleased when I got the call,'' Sen, 64, said in New York. ``But I was even more pleased when they told me the subject matter was welfare economics, a field I have long been very involved in. I am pleased that they gave recognition to that subject.''

Sen ``has restored an ethical dimension to the discussion of vital economic problems,'' the Nobel citation said.

The 64-year-old economist joined Britain's Trinity College in Cambridge this year after teaching at Harvard University, among other institutions. He has studied the Bangladesh famine of 1974 and other catastrophes in India, Bangladesh and the countries of the Sahara.

Sen works in development economics, the study of the welfare of the world's poorest people. His best-known work, detailed in his 1981 book ``Poverty and Famines: An Essay on Entitlement and Deprivation,'' challenges the common view that the shortage of food is the most important explanation of famine.

Sen downplayed his Nobel achievement, saying there were many others who deserved the prize and he wished he could share it with them. Sen was in New York to attend a memorial service Thursday for Mahbub ul Haq, a former finance minister of India.

Looking at several catastrophes, Sen has shown that ``famines have occurred even when the supply of food was not significantly lower than during previous years'' without famines, the citation said.

Part of his explanation of the 1974 Bangladesh famine is that flooding throughout the country significantly raised food prices, while work opportunities for agricultural workers declined. Due to these factors, the real incomes of agricultural workers declined so much that they were disproportionately stricken by starvation.

His work undertakes hard economic analysis and broader questions about the best ways to determine whether poverty is increasing or decreasing.

``Sen's research has practical use in every collective decision-making process,'' said Robert Eriksson, professor of sociology at the University of Stockholm. ``He cares about the poorest in society.''

Rakesh Mohan, director-general of India's National Council for Applied Economic Research, praised Sen as ``an unusual economist who has combined deep concern for human development with the very fine work in technical economics.''

Sen's award highlights an underappreciated area of study, said Scott Brown, chief economist at Raymond James & Associates, an investment firm in St. Petersburg, Fla.

``Developmental economics has never really gotten a whole lot of attention in the academic world, and certainly the magnitude of the problem and type of issues it deals with is obviously very significant,'' Brown said.

The prize was worth about $963,000 at today's exchange rate.

It is the second year in a row that the prize has gone to work with a clear connection to day-to-day lives, rather than to highly theoretical work.

This honor is the only Nobel not established in the will of Swedish industrialist Alfred Nobel, who invented dynamite. It was created in 1968 to mark the tercentenary of Sweden's central bank.

On Tuesday, Robert B. Laughlin of Stanford University, Horst L. Stormer of Columbia University and Daniel C. Tsui of Princeton University won the Nobel physics prize for discovering how electrons can change behavior and act more like fluid than particles.

The chemistry prize went to Walter Kohn of the University of California at Santa Barbara and John A. Pople of Northwestern University for developing ways of analyzing molecules in chemical reactions.

On Monday, the medicine prize was given to three Americans -- Robert Furchgott, Louis Ignarro and Ferid Murad -- for their work on discovering properties of nitric oxide, a common air pollutant but also a life-saver because of its capacity to dilate blood vessels.

The literature prize was awarded last week to Portuguese novelist Jose Saramago.

The peace prize, the last in this year's series, is to be announced Friday.

The prizes are presented on Dec. 10, the anniversary of the death of Nobel.

Wednesday October 14 2:44 PM EDT : Reports From the [Associated Press][Reuters]

STOCKHOLM (Reuters) - Amartya Sen, an Indian expert on welfare who helped the world understand what caused famine and how the poorest were treated in society, said Wednesday he was delighted to win the 1998 Nobel economics prize.

Sen, a former Harvard professor who now heads Trinity College, Cambridge, won the prestigious award ``for his contributions to welfare economics,'' the Royal Swedish Academy of Sciences said in its citation.

``It's a nice prize. One of many different kinds of nice things that can happen to a human being, of course I'm delighted,'' Sen told Reuters in an interview while visiting New York for a memorial to be held at the United Nations Thursday for Pakistan economist Mahbud ul Haq, who died in July.

``I was pleased because the academy mentioned they were giving it to me for my work in welfare economics and social choice and it is an area in which a lot of valuable work has been done by lots of people. I need not have been singled out,'' he added.

Sen's work -- ranging from the theory of social choice, through definitions of welfare and poverty, to studies of famine -- is linked by an interest in how resources are distributed, with a focus on the poorest members of society.

``By analyzing the available information about different individuals' welfare when collective decisions are made, he has improved the theoretical foundation for comparing different distributions of society's welfare and defined new, and more satisfactory, indexes of poverty,'' the academy said.

``In empirical studies, Sen's applications of his theoretical approach have enhanced our understanding of the economic mechanisms underlying famines.''

The work of Sen, born in 1933 in India's West Bengal state, could not be more different to that of the two winners of the 1997 prize who helped devise a vital tool for banks and other financial institutions in making billions of dollars through speculative trading.

Myron Scholes and Robert Merton won the prize last year for developing the formula which laid the foundation for the explosive growth in markets in financial derivatives over the past 10 years.

The two American laureates went on to become partners in Long Term Capital Management, the troubled hedge fund -- an institution set up to make speculative bets -- whose difficulties last month have seemed to threaten the entire global financial system.

Indian Prime Minister Atal Behari Vajpayee said the country was proud of Sen's achievement and President K.R. Narayanan said Sen's work was ``in tune with India's intellectual tradition.''

``You have brought to bear upon the science of economics a compassion for the ordinary human being and a vision of an egalitarian world society,'' Narayanan said.

Asked whether Sen's work could save lives, Robert Eriksson, professor of sociology at Stockholm University, told Reuters: ''I think you can say that...(Sen) did a lot of work on how to prevent and break famine.''

In his 1981 book ``Poverty and Famines: An Essay on Entitlement and Deprivation,'' Sen challenges the view that a shortage of food is the main, or only, explanation for famine.

By studying catastrophes in India, Bangladesh, Ethiopia and Saharan Africa Sen found that a shortage of food was not a sufficient explanation, the academy noted.

Sen showed, for instance, that part of the explanation for the 1974 Bangladesh famine was that flooding that year raised food prices, while work opportunities for farm workers fell sharply as one of the crops could not be harvested. The real incomes of farm workers fell so much that this group suffered disproportionately.

The prize means that Sen himself need not fear poverty. It is worth 7.6 million crowns ($960,000) this year. The institution he heads, Trinity College, Cambridge, is also one of the richest foundations in England.

Professor Ajit Singh, senior fellow of Queen's College and a colleague of Sen, said the prize was expected and well deserved.

``The whole world will rejoice at Professor Sen's prize...He has made brilliant contributions to economic theory, as well as addressing the practical problems of poverty and famines in developing countries,'' he said.

Professor Sir Alec Broers, Vice-Chancellor of Cambridge University, said Sen's Nobel Prize added luster and breadth to the study of economics at the university.

``We are delighted to hear that Professor Amartya Sen has been awarded the Nobel Prize for Economics. Professor Sen's work has contributed a tremendous amount to society as well as to economic theory, a subject of great importance to the world,'' he said.

The prize is awarded each year by Sweden's central bank, the Riksbank, and known officially as the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.