Nobel mechanism

Monday morning’s press conference was part of "a rich tradition," said Chicago Provost Thomas Rosenbaum, "going back 100 years, when Joseph Michelson won the first American Nobel in the sciences." The latest—at No. 80—laureate with a Chicago connection was the reason for the media event: Roger B. Myerson, the Glen A. Lloyd distinguished service professor in economics, received the dawn phone call from Sweden announcing that he had won the 2007 Nobel in economics.

With Leonid Hurwicz of the University of Minnesota and Eric S. Maskin of the Institute for Advanced Study (Princeton, New Jersey), Myerson received the prize (formally known as the Sveriges Riksank Prize in Economic Sciences in Memory of Alfred Nobel) "for having laid the foundation of mechanism design theory."

At the podium Myerson—a Harvard PhD in applied mathematics who in 2001 joined the Chicago economics faculty after spending the majority of his academic career at Northwestern’s Kellogg School of Management—beamed and beamed. "It's first and foremost about ideas," he said. "I'm excited that ideas I thought were important, that I wanted to devote my life to," have been thrust into the limelight.

Mechanism design theory, said Myerson, recognizes that "the economy needs to be understood as a communications system" as well as a market system, and thus provides a way to distinguish situations in which markets work well from those in which they do not. The theory has been used in many areas of economics and in parts of political science, helping to identify efficient trading mechanisms, regulation schemes, and voting procedures.

"Now that you've won," a reporter wanted to know, "what is the most important thing you're going to do next?"

The newly minted laureate didn’t seem to give that one too much thought: "I've got a seminar on Tuesday I've gotta give."


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Photos (left to right): Not just another day at the office: economist Roger Myerson gets a visit from the press; the Reynolds Club’s McCormick-Tribune Lounge was turned into a press room as media, colleagues, and students turned out to congratulate Myerson; newest member of the club: Myerson (second from left) is joined by 2000 laureate James J. Heckman; 1992 winner Gary S. Becker AM’53, PhD’55; and 1995 laureate Robert E. Lucas Jr., AB’59, PhD’64.

Photos by Dan Dry

October 15, 2007