{"59382":{"#nid":"59382","#data":{"type":"news","title":"Nobel Prize in Economics Awarded","body":[{"value":"\u003Cp\u003EPress Release\n\u003C\/p\u003E\n\u003Cp\u003E15 October 2007\n\u003C\/p\u003E\n\u003Cp\u003EThe Royal Swedish Academy of Sciences has decided to award The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2007 jointly to\n\u003C\/p\u003E\n\u003Cp\u003ELeonid Hurwicz\u003Cbr \/\u003E\nUniversity of Minnesota, MN, USA,\n\u003C\/p\u003E\n\u003Cp\u003EEric S. Maskin\u003Cbr \/\u003E\nInstitute for Advanced Study, Princeton, NJ, USA\n\u003C\/p\u003E\n\u003Cp\u003Eand\n\u003C\/p\u003E\n\u003Cp\u003ERoger B. Myerson\u003Cbr \/\u003E\nUniversity of Chicago, IL, USA\n\u003C\/p\u003E\n\u003Cp\u003E\u0022for having laid the foundations of mechanism design theory\u0022.\n\u003C\/p\u003E\n\u003Cp\u003EThe design of economic institutions\n\u003C\/p\u003E\n\u003Cp\u003EAdam Smith\u0027s classical metaphor of the invisible hand refers to how the market, under ideal conditions, ensures an efficient allocation of scarce resources. But in practice conditions are usually not ideal; for example, competition is not completely free, consumers are not perfectly informed and privately desirable production and consumption may generate social costs and benefits. Furthermore, many transactions do not take place in open markets but within firms, in bargaining between individuals or interest groups and under a host of other institutional arrangements. How well do different such institutions, or allocation mechanisms, perform? What is the optimal mechanism to reach a certain goal, such as social welfare or private profit? Is government regulation called for, and if so, how is it best designed?\n\u003C\/p\u003E\n\u003Cp\u003EThese questions are difficult, particularly since information about individual preferences and available production technologies is usually dispersed among many actors who may use their private information to further their own interests. Mechanism design theory, initiated by Leonid Hurwicz and further developed by Eric Maskin and Roger Myerson, has greatly enhanced our understanding of the properties of optimal allocation mechanisms in such situations, accounting for individuals\u0027 incentives and private information. The theory allows us to distinguish situations in which markets work well from those in which they do not. It has helped economists identify efficient trading mechanisms, regulation schemes and voting procedures. Today, mechanism design theory plays a central role in many areas of economics and parts of political science.\n\u003C\/p\u003E\n\u003Cp\u003ECopyright Nobel Web AB 2007\n\u003C\/p\u003E","summary":null,"format":"limited_html"}],"field_subtitle":"","field_summary":[{"value":"The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2007","format":"limited_html"}],"field_summary_sentence":[{"value":"Leonid Hurwicz receives 2007 Nobel Prize"}],"uid":"27205","created_gmt":"2007-10-31 00:00:00","changed_gmt":"2016-10-08 03:01:46","author":"Kari White","boilerplate_text":"","field_publication":"","field_article_url":"","dateline":{"date":"2007-10-15T00:00:00-04:00","iso_date":"2007-10-15T00:00:00-04:00","tz":"America\/New_York"},"extras":[],"related_links":[{"url":"http:\/\/nobelprize.org\/nobel_prizes\/economics\/laureates\/2007\/","title":"Nobel Prize in Economics"},{"url":"http:\/\/nobelprize.org\/nobel_prizes\/economics\/laureates\/2007\/announcement.html","title":"Prize Announcement Video"}],"groups":[{"id":"1282","name":"School of Economics"}],"categories":[{"id":"135","name":"Research"}],"keywords":[{"id":"602","name":"economics"},{"id":"7715","name":"Nobel Prize"}],"core_research_areas":[],"news_room_topics":[],"event_categories":[],"invited_audience":[],"affiliations":[],"classification":[],"areas_of_expertise":[],"news_and_recent_appearances":[],"phone":[],"contact":[{"value":"\u003Cstrong\u003EKari White\u003C\/strong\u003E\u003Cbr \/\u003ESchool of Economics\u003Cbr \/\u003E\u003Ca href=\u0022http:\/\/www.gatech.edu\/contact\/index.html?id=kmccarley3\u0022\u003EContact Kari White\u003C\/a\u003E\u003Cbr \/\u003E\u003Cstrong\u003E404-894-4919\u003C\/strong\u003E","format":"limited_html"}],"email":["kari.white@econ.gatech.edu"],"slides":[],"orientation":[],"userdata":""}}}