2 Americans win economics Nobel for match-making
AP and ReutersSTOCKHOLM -- Two Americans were awarded the Nobel economics prize on Monday for studies on the match-making taking place when doctors are coupled up with hospitals, students with schools and human organs with transplant recipients.
October 16, 2012, 12:39 am TWN
The work of Alvin Roth and Lloyd Shapley has sparked a “flourishing field of research” and helped improve the performance of many markets, the Royal Swedish Academy of Sciences said.
Roth, 60, is a professor at Harvard University in Boston. Shapley, 89, is a professor emeritus at University of California Los Angeles.
“This year's prize concerns a central economic problem: how to match different agents as well as possible,” the academy said.
Shapley made early theoretical inroads into the subject, using game theory to analyze different matching methods in the 1950s and '60s. Together with U.S. economist David Gale, he developed a mathematical formula for how 10 men and 10 women could be coupled in a way so that no one would benefit from trading partners.
While that may have had little impact on marriages and divorces, the algorithm they developed has been used to better understand many different markets.
In the 1990s, Roth applied it to the market for allocating U.S. student doctors to hospitals. He developed a new algorithm that was adopted by the National Resident Matching Program, which helps match resident doctors with the right hospitals.
“Even though these two researchers worked independently of one another, the combination of Shapley's basic theory and Roth's empirical investigations, experiments and practical design has generated a flourishing field of research and improved the performance of many markets,” the academy said.
The official prize citation said the two were awarded for “the theory of stable allocations and the practice of market design.”
Roth, who was sleeping when the call from Stockholm came and missed the first call, said the award was unimaginable and unexpected: “It certainly is expected that Lloyd Shapley should win the prize. It would have been a grave oversight if he did not. So I am glad to share it with him.”
This 2012 photo shows economics professor Alvin E. Roth, of Harvard, who, along with Lloyd S. Shapley, was awarded the Nobel economics prize. (Image captured from the Internet)