Nobel Prize in Economics Americans Paul R. Milgrom and Robert B. Wilson goes to auction for innovations –

Nobel Prize in Economics Americans Paul R. Milgrom and Robert B. Wilson goes to auction for innovations

Stockholm – Two American economists won the Nobel Prize on Monday for improving the work of the auction, which greatly affects today’s economy, the way Google sells ads to companies to gain airwaves from the government.

The Nobel Committee stated that Paul R. of Stanford University Milgrom and Robert B. Wilson’s discoveries have benefited sellers, buyers and taxpayers around the world.

Wilson ever received Milgrom’s Ph.D. Advisor, and two are also neighbors. Reached by phone at his home in California, Milgrom said he received the news of his victory “strangely”.

“I got a knock at my door from Bob Wilson” when it was still midnight, he told The Associated Press.

Students, friends and colleagues had long suggested that the 83-year-old and Wilson could be the reason for the award, said Milgrom, 72.

Milgrom said, “His respect as well as his affection is good.”

Two people to deal with the difficult problem of working efficiently at auctions. The committee stated that Wilson’s work shows “why rational bidders place bids below their best estimate of their normal price” – which may mean that the item goes for less than that price and Probably not the buyer who wants it the most, none of which is believed if the auction is working properly.

The impact of his work can be seen all around. “Online advertising is sold at auction,” said David Warsh, who monitors economic research in his blog Economic Principal. “That Google was able to adopt so quickly and radically was entirely dependent on the principle developed by Milgrom and his competitors and their customers.”

Work is more than money. For example, some governments auction the right to pollute in the hope of reducing emissions; Cleaner companies can resell unnecessary rights to dirtiers, giving companies a financial incentive to build their operations. “The objective is not always to maximize revenue for the seller, but also to have a social purpose,” said Nobel committee member Ingrid Werner.

One problem for sellers at auctions is the curse of the so-called winner. If buyers are giving the right to buy, say, the fishing right, then they have to speak without knowing what the price of the fish will be in the future. They start worrying that they will only hawk from overapping, and they can take back their proposals and reply.

One solution, Wilson and Milgrom’s research, suggests is that it is possible for the seller to provide as much information as possible before bidding begins, perhaps providing an independent assessment of the item being sold.

Wilson said he “saw the snake in a grass-roots strategy”. It involves a company who is interested in the item that is secretly sold for most of the auction and then bids the winner at the last minute.

Wilson told AP, “It’s like ripping off an eBay auction. They said they design rules that force bidders to reveal their interest.”

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His research has had a major impact on the telecommunications industry, where private companies seek licenses from the government to use publicly owned radio frequencies for everything from mobile phone calls to Internet payments.

Prior to the 1990s, the US government essentially conducted “beauty contests” to exclude frequencies, allowing companies to make their case for licensing. The approach encouraged aggressive lobbying but did not raise much money for the Treasury.

In 1994, the US government turned into an auction. Milgrom and Wilson (with the help of Preston McAfee, now at Google) designed an auction format in which all licenses were sold at once. This format discourages speculators from purchasing frequencies in a specific geographic area and then remodels them for larger telecommunications companies seeking to patch with national or regional networks.

The auction sold for $ 617 million – which had never been handed over for doing anything before, and became a model from Canada to India. The format has also been used to auction electricity and natural gas.

Wilson said he felt that his time for winning the Nobel Prize for work had already passed.

Speaking to reporters in Stockholm after learning of his win, Wilson recently struggled to think of an auction in which he himself participated. But then he said: “My wife tells me that we bought ski shoes on eBay.”

Wilson described Milgrom, who developed a more general theory of auction, “like the genius behind this auction work.”

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Americans figure prominently among this year’s Nobel laureates. Seven of the 11 awardees have been Americans, except the Peace Prize, which went to the United Nations World Food Program.

Goran Hanson, secretary general of the Royal Swedish Academy of Sciences, who announced the award, said that US investment in research reflected post-WWII. “And we’ll see how this trend can change,” he said.

Wilson said that, given the coronavirus epidemic, he had no immediate plans for what to do with his share of the 10 million krone ($ 1.1 million) cash prize that comes with the prize, plus a gold Medal too.

“Maybe I’ll save it for my wife, my children.”

Last year’s award went to two researchers from the Massachusetts Institute of Technology and a third from Harvard University for their research in efforts to reduce global poverty.

Some economists may have predicted last fall that the world would come to a virtual standstill within months, as governments closed their borders, imposed lockdowns and ordered other measures that led to a brisk worldwide business activity The spread of COVID-19 is inhibited by triggering degradation.

The prestigious award comes with a 10 million krona ($ 1.1 million) cash prize and a gold medal.

On Monday, the Nobel Committee honored Award for Physiology and Medicine For the discovery of liver-hepatitis C virus. Of tuesday Prize for physics Successes in understanding the mysteries of cosmic black holes were honored, and Chemistry award Wednesday went to the scientists behind a powerful gene-editing tool.

Literary Award American poet Louise Gluck was honored on Thursday for her “forthright and unsubstantiated” work. Wins World Food Program Nobel Peace Prize On Friday for his effort to combat worldwide hunger.


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