ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Nobel in Auction

A Foray into the 2020 Nobel Prize in Economics

The 2020 Nobel Prize in Economics was awarded to Paul R Milgrom and Robert B Wilson for their contribution to auction theory. Auction designs end up helping private and public players to make a valuation of a public good and, hence, create a market that did not exist beforehand, which quite often overlooks the underlying concrete social and environmental concerns.

The Nobel Prize in Economics is a latecomer; it was not in the schedule of the original will of Alfred Nobel in 1895. It was introduced later in 1968. Sweden’s Central Bank Sveriges Riksbank, on its 300th anniversary, gave a donation to the Nobel foundation from which these new accolades were introduced. It was soon accommodated within the original prizes and given in the same ceremony. In his 1970 Nobel lecture, Paul Samuelson jokingly commented that unlike the physicists, the budding economists of the 1940s and 1950s never vied for a Nobel Prize. The situation has drastically changed now. It is now a coveted prize for economists, too. It is already attached with some great names from the discipline. However, there have also been controversies ever since its inception. Numerous worthy economists were denied—Joan Robinson, Trevor Swan, Paul Sweezy, Feldman, Andre Gunder Frank, among several others. According to one estimate (up to 2018), out of the 52 Nobel Prizes (and 86 individuals) in economics, 44 were awarded to Americans or persons working in the United States (US), 25 went to Europe and only two went to the erstwhile USSR. As of October 2018, the University of Chicago has won 32 of the prizes. It was suggested that the prize was heavily biased towards mainstream economists, and had never gone to any alternative school within economics, with the sole exception of Gunnar Myrdal.

The Nobel Prize for economics for 2020 was awarded to two Stanford University professors, Paul R Milgrom and Robert B Wilson, for their work on auction theory. Controversies arose immediately. Branko Milanović argued that the prize should have gone to work on wealth, poverty, inequality and similar issues (Dehejia 2020). According to Milanović, economics is a social science aimed at ensuring that people are materially endowed. Auction theory does not serve this purpose.

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Updated On : 6th Sep, 2022
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