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October 12, 2020
by Johannes Ledel, With Marc Preel
US economists Paul Milgrom and Robert Wilson won the Nobel Prize in economics on Monday for their work on commercial auctions, including goods and services that are difficult to sell in traditional ways like radio frequencies, the Nobel committee said
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The duo were honored « for improvements in auction theory and inventions of new auction formats, » the jury said
The Royal Swedish Academy of Sciences noted that the findings of Milgrom, 72, and Wilson, 83, « have benefited sellers, buyers and taxpayers around the world, » he said in a press release
Wilson, professor at Stanford in the United States, has been honored for developing an auction theory with a common value, « a value which is uncertain beforehand but which is ultimately the same for everyone « , according to the academy
Wilson’s work has shown why rational bidders tend to bid based on their own estimate of value due to concerns about the « winner’s curse » or winning the auction but overpaying. p>
Milgrom, also at Stanford, then proposed a more general auction theory, analyzing bidding strategies in different forms of bidding
The academy noted that while « people have always sold things to the highest bidder, » corporations have also had to allocate « increasingly complex objects such as landing slots and radio frequencies »
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« In response, Milgrom and Wilson invented new formats for auctioning many interrelated items simultaneously, on behalf of a seller driven by broad societal benefit rather than maximum income, » said the academy
The winners will share the sum of 10 million Swedish kronor (approximately $ 1 million, 950,000 euros)
Speaking to reporters in Stockholm via a telephone link, Wilson said the announcement was « very good news », acknowledging that despite his research he had « never been to an auction. »
However, he quickly had to withdraw his statement « My wife points out that we bought ski boots on eBay, I guess it was an auction, » Wilson said
Last year, the honor was given to the French-American Esther Duflo, the American Abhijit Banerjee, born in India, and the American Michael Kremer for their experimental work on the fight against poverty
Even though it is the most prestigious prize an economist could hope to receive, the prize in economics has not achieved the same status as the prizes initially chosen by Alfred Nobel in his founding will of 1895 the prizes, which included medicine, physics, chemistry, literature and peace
Rather, it was created in 1968 with a donation from the Swedish central bank and critics have dubbed it « a false Nobel »
The prize closes the 2020 Nobel season, which saw the closely watched Peace Prize being awarded to the UN World Food Program
Women have been more prevalent than usual this year, with American poet Louise Gluck taking home the prize for literature
Frenchwoman Emmanuelle Charpentier and American Jennifer Doudna became the first all-female duo to win a Nobel Science Prize on Wednesday, winning the chemistry prize for their discovery of CRISPR-Cas9 « scissors » to cut DNA
Although the number of female laureates has increased sharply since the turn of the century, they still represent only around one in 20 Nobel medals since 1901
Winners would normally receive their Nobel Prize from King Carl XVI Gustaf at an official ceremony in Stockholm on December 10, but the pandemic means it has been replaced by a televised ceremony showing the winners receiving their prizes in their country original
© 2020 AFP
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Economics, Nobel Laureate in Economics, Paul Milgrom, Robert B Wilson, Auction Theory
World News – The American and American duo win the Nobel Prize in Economics for their auction work
SOURCE: https://www.w24news.com
