• Sweden edition
 
NOBEL PRIZES 2012
US duo awarded Nobel economics prize

US duo awarded Nobel economics prize

Published: 15 Oct 2012 13:05 GMT+02:00
Updated: 15 Oct 2012 13:05 GMT+02:00

The winners were awarded "for the theory of stable allocations and the practice of market design".

“This year's prize is awarded for an outstanding example of economic engineering,” wrote the Nobel Committee in a statement.

According to the Committee, this year's Prize “concerns a central economic problem: how to match different agents as well as possible”.

Shapley made early theoretical inroads into the subject, using game theory to analyze different matching methods in the 1950s and 1960s.

Together with U.S. economist David Gale, he examined “pairwise matching,” by looking at how 10 women and 10 men could be coupled up, while respecting their individual preferences.

The studies were carried out with a focus on “stable matching” – that being the most efficient matching as possible of, for example, students with schools or organ donors with patients.

Roth was later responsible for putting Shapley’s work into practice with research carried out in the 1980s and 1990s.

“Even though these two researchers worked independently of one another, the combination of Shapley's basic theory and Roth's empirical investigations, experiments and practical design has generated a flourishing field of research and improved the performance of many markets,” the committee wrote in a statement.

Staffan Normark, permanent secretary of the Royal Swedish Academy, explained that it was the perfect match of the two economists themselves that led to their work being recognized by the Nobel Committee.

“Lloyd Shapley is a giant in the field of game theory with a huge number of fantastic accomplishments,” he told The Local.

“I think this is a good match to put these two individuals together for this prize with all the theoretical work in the beginning and you have a really practical outcome developed quite recently by Roth with, for example the kidney transplant system in matchmaking.”

“I think it’s a beautiful combination.”

Roth said he was sleeping when he got the call from the prize committee in California, where he is a visiting professor at Stanford University.

“I wasn’t expecting the prize but I was aware it was being awarded today," he said.

"I expected that Lloyd Shapley would win the prize."

In terms about what the prize means, he joked:

“When I go to class this morning, my students will pay more attention now," but added it was "too early" to speculate on how the win might affect the field.

Roth said he intends to travel to Stockholm for the Nobel award ceremony in December. When asked how he would celebrate, he said: “I haven’t made any plans yet; coffee."

Roth, 60, is a professor at Harvard University in Boston. Shapley, 89, is a professor emeritus at University of California Los Angeles.

The Nobel Memorial Prize in Economic Sciences was the last of the 2012 Nobel awards to be announced.

It’s not technically a Nobel Prize, because unlike the five other awards it wasn’t established in the will of Alfred Nobel, a Swedish industrialist also known for inventing dynamite.

The economics prize was created by the Swedish central bank in Nobel’s memory in 1968, and has been handed out with the other prizes ever since. Each award is worth 8 million kronor ($1.2 million).

Last year’s economics prize went to U.S. economists Thomas Sargent and Christopher Sims for describing the cause-and-effect relationship between the economy and government policy.

The 2012 Nobel Prizes in medicine, physics, chemistry and literature and the Nobel Peace Prize were announced last week. All awards will be handed out on December 10th, the anniversary of Nobel’s death in 1896.

Oliver Gee/AFP

Follow Oliver on Twitter here

The Local (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

15:00 October 15, 2012 by Hamsterdam
Just more fawning over US economics as the model Sweden most admires.

The Nobel's are nothing more than a pompous embarrassment that culminate in an evening that focusses on the dresses worn by the women. How grand.
23:11 October 15, 2012 by acidcritic
I propouse a world concourse for a duty free travel to Stockholm. Answer to the following question;: "What is worse the Peace Nobel Prize or the Nobel Prize in Economics?
Today's headlines
Race to be scrapped from Swedish legislation
Integration Minister Erik Ullenhag meets children in Husby, Stockholm. Photo: Jonas Ekströmer/TT

Race to be scrapped from Swedish legislation

The Swedish government announced that it plans to remove all mentions of race from Swedish legislation, saying that race is a social construct which should not be encouraged in law. READ  

US aircraft 'violates' Swedish airspace

US aircraft 'violates' Swedish airspace

A mystery airplane that passed over Swedish airspace recently has been revealed as an American aircraft, sources revealed on Thursday. READ  

Elite schools stripped of 'special' privileges

Elite schools stripped of 'special' privileges

Sweden's three elite boarding schools can no longer charge tuition fees, the government announced on Thursday, in a string of changes following a two-year review. READ  

Bildt lays out four steps to Gaza peace
Photos: TT

Bildt lays out four steps to Gaza peace

Swedish Foreign Minister Carl Bildt stated that there are four steps to achieving peace in Gaza, and that it begins with removing the blockade - which has "played into Hamas' hands". READ  

Malmström snags EU commissioner post again

Malmström snags EU commissioner post again

Cecilia Malmström has been nominated to be the European Commissioner for another five years, Sweden's prime minister announced on Thursday. READ  

Stockholm Pride 2014
In Pictures: Stockholm's Historic Pride Party
Conchita Wurst belts out a ballad. Photo: Rebecca Jacobs

In Pictures: Stockholm's Historic Pride Party

With Stockholm's Pride Week in full swing, The Local's Rebecca Jacobs heads on down to the traditional Historic Party to take in the colours, Conchita, and the community. READ  

Two to hospital after Stockholm fire

Two to hospital after Stockholm fire

Two people were taken to hospital in the early hours of Thursday morning after a fire began in their central Stockholm apartment. READ  

Salmonella prompts Coop hamburger recall
Photo: Jim Cole/TT

Salmonella prompts Coop hamburger recall

Swedish supermarket chain Coop has recalled its in-store brand of fresh hamburger meat after a routine check revealed traces of salmonella in the meat. READ  

What's On in Sweden
Photo: Roger Vikström/TT

What's On in Sweden

It's Pride Week in Stockholm. Find out more about the celebrations (including the biggest Pride Parade in Scandinavia) as well as plenty of other activities in Sweden's three biggest cities. READ  

Sweden resumes aid to 'anti-gay Uganda'
Hillevi Engström and protesters against Uganda's anti-gay laws. Photos: Maja Suslin/Ben Curtis/TT

Sweden resumes aid to 'anti-gay Uganda'

Sweden has resumed sending development aid funds to Uganda, after suspending payouts back in March due to "anti-gay legislation". READ  

RECEIVE OUR NEWSLETTER AND ALERTS
National
Stockholm Pride bars Sweden Democrats
National
Gender neutral pronoun 'hen' enters dictionary
Society
Top ten cafes in Stockholm
People-watching
Gallery
People-watching - Stockholm Pride
Photo: Henrik Trygg/Imagebank Sweden
Society
Sweden worst in EU at getting foreigners jobs
Blog updates

31 July

Calling a speedo a speedo (Blogweiser) »

"There are a lot of speedos on Europe’s beaches. Some European males are evidently more comfortable sporting small, stretchy suits on public beaches than I would be. I accept it may be nice to have swimwear that’s not long and cumbersome. A speedo is maybe also good for tanning. But strolling around town in a..." READ »

 

27 July

Approaching Stockholm (Around Sweden in a kayak) »

"I woke up in the comfort of my own little cabin on Eva and Rolf’s boat, it was 7:30am and I was feeling a bit groggy after a couple of beers with all the lovely locals the night before. The previous day had really taken its toll on my body and I was very stiff and..." READ »

 
 
 
Lifestyle
Stockholm Pride kicks off
Analysis
The top six ways the US and Sweden differ
National
Swedish youth suicides hit 25-year high
National
Politician reported for selling 'negro ball'
National
Police turn blind eye to Swedish 'slave trade'
Gallery
Stockholm Pride: Allsång på Skansen with Conchita Wurst
Skatteverket
Sponsored Article
Introducing... ID cards and permits in Stockholm
Gallery
People-watching, June 26th - 28th. Get inside Stockholm's hottest nightclubs
Gallery
Top ten Swedish taboos
Society
Seven-year-old Swede cycles to Berlin
Politics
'Gaza conflict needs help, not empty rhetoric'
Society
Swedes voted 'most beautiful' in the Nordics
Business & Money
Sweden demands EU clarity on Bitcoin tax
National
Swedish organic sales enjoy 'amazing' growth
Photo: Johan Nilsson/TT
Society
What's On in Sweden
Gallery
People-watching July 23
National
Swedish cops elect not to shoot 'angry elks'
Business & Money
New alcohol retail rules threaten micro-breweries
Gallery
People-watching Båstad
Sponsored Article
Introducing... Your finances in Stockholm
Sponsored Article
Introducing... Housing in Stockholm
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

750
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com
If you want to drink, that’s your business.
If you want to stop, we can help.

Learn more about English-language Alcoholics Anonymous in Sweden. No dues. No fees. Confidentiality assured.
AA-EUROPE.ORG/SWEDEN
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at:
http://psdmedia.se