American economist Paul Milgrom along with his colleague Robert Wilson have been awarded the 2020 Nobel Prize in Economic Sciences for their contributions to auction theory, announced the Royal Swedish Academy of Sciences on Monday, October 12.
Milgrom, the Shirley R. and Leonard W. Ely, Jr. Professor of Humanities and Science in the Department of Economics at Stanford University, gave the Kenneth J. Arrow Lecture at Columbia University in 2014. That lecture was subsequently published as the book Discovering Prices: Auction Design in Markets with Complex Constraints by Columbia University Press in 2017, as part of the Kenneth J. Arrow Lecture Series.
In Discovering Prices, Milgrom describes how auctions can be used to discover prices and guide efficient resource allocations, even when resources are diverse, constraints are critical, and market-clearing prices may not even exist. Milgrom roots his theories in real-world examples, including the ambitious U.S. incentive auction of radio frequencies, whose design he led. Both lively and technical, Milgrom’s analysis provides economists with crucial new tools for dealing with the world’s growing complex resource-allocation problems.
Watch this video of Paul Milgrom discussing his research as part of the Kenneth J. Arrow Lecture series.