American Trio Bags 2007’s Nobel For Economics

American economists Leonid Hurwicz, Eric S. Maskin and Roger B. Myerson won the 2007 Nobel Prize for Economics for laying the foundation of economic theories that analyze market imperfections. The economists will share a prize of $1.57 million.

Their work, called mechanism design theory, determines when markets are working effectively, how well different institutions fare in allocating resources and whether government intervention is required.

It checks for bumpy situations in the market and help set rules for transactions ranging from government-bond auctions to setting up patent systems and creating new voting procedures.

Their work is used to help find the "most efficient method for allocating resources given the available information, including the incentives of those involved,” the academy said.

Leonid Hurwicz, 90, is the oldest-ever recipient of the esteemed award. A Professor of Economics Emeritus at the University of Minnesota, he initiated the development of mechanism design.

“I guess my first thought when I heard Hurwicz was one of the winners was a sense of relief. Hurwicz has been a candidate for many years and he’s now 90 years old and time was running out,” elated Maskin said in a telephonic interview.

“It was a tremendous thrill to hear that he won and to share the prize with him and with Myerson. Our friendship goes back to university time,” he added.

Hurwicz’s work was further developed and refined by economists with whom he is sharing the prize: Eric S. Maskin, 57, earned his doctorate in Applied Mathematics from Harvard in 1976 and is currently the Albert O. Hirschman Professor of Social Science, at the Institute for Advanced Study in Princeton, New Jersey. While, Roger B. Myerson was born in Boston in 1951. He finished his doctorate in Applied Mathematics at Harvard in 1976. He is currently the Glen A. Lloyd Distinguished Service Professor at the University of Chicago.

The theory now plays an important role in many areas of economics and parts of political science.