The 2011 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel will go, jointly, to Thomas J. Sargent and Christopher A. Sims "for their empirical research on cause and effect in the macroeconomy."  This seems a timely award for two men who have done a great deal of work on the relationship between public policy moves and economic growth.  As central banks consider tools at their disposal to manage inflation or deflation, or elected officials argue over tax policy and spending, the work of Sargent and Sims provides needed analysis of potential impact.  From the Nobel press release:

Thomas Sargent has shown how structural macroeconometrics can be used to analyze permanent changes in economic policy. This method can be applied to study macroeconomic relationships when households and firms adjust their expectations concurrently with economic developments. Sargent has examined, for instance, the post-World War II era, when many countries initially tended to implement a high-inflation policy, but eventually introduced systematic changes in economic policy and reverted to a lower inflation rate.

Christopher Sims has developed a method based on so-called vector autoregression to analyze how the economy is affected by temporary changes in economic policy and other factors. Sims and other researchers have applied this method to examine, for instance, the effects of an increase in the interest rate set by a central bank. It usually takes one or two years for the inflation rate to decrease, whereas economic growth declines gradually already in the short run and does not revert to its normal development until after a couple of years.

Sims and Sargent are much, much better know within central bank staffs than by the general public.  We're on the lookout for some of their public speeches.  So far we have two that provide glimpses into their work.  First, here's Sargent speaking last year  at Wake Forest University Business School about where the line between monetary and fiscal policy has been drawn throughout US history.  (Starting at 06:00, Sargent addresses the debate, going back 235 years of whether there should be a central bank in the US):

Thomas Sargent: Drawing Lines in U.S. Monetary and Fiscal History from WFU Schools of Business on Vimeo.

And here is Sims speaking at an Institute for New Economic Thinking event last year, in which he discusses interest rate policy at central banks and the effectiveness of modeling tools in aiding central bank decision-making: