Paul R Milgrom and Robert B Wilson win 2020 Nobel Prize in Economics

They were awarded for improvements to auction theory and inventions of new auction formats

Two Stanford University academics who helped design the US auction that allocates mobile-phone frequencies will share the 2020 Nobel Prize in economics. Paul Milgrom and Robert B Wilson, whose ideas have been applied to sales of anything from aircraft landing slots to fishing quotas, won’t need to travel to Stockholm to receive the award because of Covid-19, according to Nobel officials.

“They have used their insights to design new auction formats for goods and services that are difficult to sell in a traditional way, such as radio frequencies,” the Royal Swedish Academy of Sciences said in a statement on Monday.

The 2020 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel is again opting to laud the real-world application of the discipline, after recent years of honoring groundbreaking research ranging from inequality to climate change to behavioural economics.

“It’s very happy news, I’m very glad about it,” the 83-year-old Wilson told a press conference in Stockholm by phone from his home in California. “It’s very early in the morning here.”

Robert B Wilson, professor emeritus at Stanford

Wilson, who was born in Nebraska and studied at Harvard University, was the thesis adviser of his fellow winner. The 72-year-old Paul Milgrom was born in Detroit and earned his PhD in business at Stanford in 1978. He and Wilson, along with Preston McAfee, are best known for the so-called simultaneous ascending auction, which was developed for the US Federal Communications Commission’s 1994 sale of spectrum.

Paul R Milgrom, a professor at Stanford University

The method has since been used to set prices on such things as electricity and gas. Milgrom advised on Google Inc.’s 2004 initial public offering, and has also been an adviser to Yahoo!, Microsoft Corp and the government across the world, according to his website.

Wilson, was questioned at the press conference on what was the last thing he bought at an auction. “My wife points out to me, we bought ski boots on Ebay,” he said. “I guess that’s an auction.” The 2020 Economics Prize outcome expands the list of male laureates of the prize to 84. Only two women have ever won it, including Duflo last year.