Oliver Hart and Bengt Holmström, both active in the united states, share this year’s prize in economics in memory of Alfred Nobel. – It feels absolutely amazing, ” says Oliver Hart to TT.
this Year’s winners.
Hart, 68, born in London, in the Uk, and Holmström, 67, was born in Helsinki in Finland, but both are since long active in the united states.
the prize for The theoretical work on contracts. Theories involving everything from insurance policies to be found with the banks, and contracts.
– It is a fundamental phenomenon that affects most of us, ” says Per Strömberg, chairman of the committee for the prize in economic sciences.
“Their work is extremely important to understand this type of contract,” says Strömberg.
the TT reaches one of the prize winners directly by phone:
“It feels absolutely fantastic,” says Oliver Hart just minutes after the announcement.
He follows the press conference from home.
” Excuse me, can you call me a little later. I just want to follow this, ” he says.
To The nobel prize’s official Twitter account, ” says Oliver Hart: “I woke up 04.40 and wondered if it was too late now for that I would be able to get the price in years, but luckily the phone rang then”.
Concerning what he did directly after the call:
“My first reaction was to hug my wife and wake up my son… then I talked with the other winner of the prize (Bengt Holmström).”
Bengt Holmström is on the link at the press conference.
“I was very surprised and very happy,” says Holmström about his reaction when he learned that he was one of the winners.
On the question about what he thinks on the level of the ceo:ars bonuses in the day, he answers:
” We do not take a position to the level of the bonuses. Our research is more about the type of structures to be used. My personal opinion is that the structures are too complex today.
he says He’s not thinking about what he should do with the prize money.
“It’s the last thing I think of,” says Holmström, who had not expected to get the price.
It is important to understand contracts, how they work and why they look the way they do, to understand an economy, according to Mats Persson, professor of economics at Stockholm university, who were on the committee that developed the proposal for this year’s two winners.
” the Contract has always existed, but the laureates have sorted out the theoretical foundations for contracts. Hopefully that will make that in the future we will be a bit better to write the contract and give the proper incentives to business leaders, politicians, private entrepreneurs to operate on the public data within the vårdsektor or school.
Mats Persson identifies especially Bengt holmström’s research on how to pay a director.
– Then it turns out that the companies that have a strong owner, then contracts very often theoretically correct. While the companies that do not have a strong owner, well then, seems the contracts become a little bit hipp as happ and often so that it benefits the management a lot and the disadvantage of the shareholders.
Strong owner is important, is one of the conclusions one can draw from the contracting theory that the nobel laureates have developed, according to professor Mats Persson.
– This is where we have seen lots of examples of in the confederation of Swedish enterprise. If we have companies with dispersed ownership – no strong owner, but the employees, the directors control of the company – then, they started with a lot of oddities. Then they fly with jet to älgjakter in the north of sweden and such where things.
the Facts: the Winners
Oliver Hart was born in 1948 in London in the Uk. He obtained his doctorate in 1974 at Princeton University in the united states, and is now a professor of economics at Harvard University in the united states.
Bengt Holmström was born in 1949 in Helsinki, Finland. He has a phd in 1978 at Stanford University, and is currently professor of economics at the Massachusetts Institute of Technology in the united states.
the Prize is worth eight million kronor and is divided equally between the laureates.
Source: KVA.
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