American Duo Wins Nobel Economics Prize for Work on Auctions

US economists Paul Milgrom and Robert Wilson won the Nobel Economics Prize. (AFP)
US economists Paul Milgrom and Robert Wilson won the Nobel Economics Prize. (AFP)
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American Duo Wins Nobel Economics Prize for Work on Auctions

US economists Paul Milgrom and Robert Wilson won the Nobel Economics Prize. (AFP)
US economists Paul Milgrom and Robert Wilson won the Nobel Economics Prize. (AFP)

US economists Paul Milgrom and Robert Wilson won the Nobel Economics Prize on Monday for work on commercial auctions, including for goods and services difficult to sell in traditional ways such as radio frequencies, the Nobel Committee said.

The Royal Swedish Academy of Sciences noted that the discoveries by Milgrom, 72, and Wilson, 83, "have benefitted sellers, buyers and taxpayers around the world," it said in a statement.

"Auctions affect all of us at every level. Moreover, they are becoming increasingly common and increasingly complicated," the academy said, listing examples such as flexible electricity prices set by daily auctions and countries raising funds through government bond auctions.

Milgrom and Wilson's work "gives us a better understanding of how we should design auctions," jury member Peter Fredriksson told AFP.

‘Winner's curse’
Wilson was spotlighted for developing a theory on auctions focusing on a common value, such as the future value of radio frequencies, or the rights to extract minerals in a particular area.

This common value "is uncertain beforehand but, in the end, is the same for everyone," according to the academy.

Wilson's work during 1960s and 1970s showed why bidders tended to bid under what they actually thought the good was worth.

The answer was that they feared the "winner's curse," or winning the auction but paying too much.

Milgrom then came up with a more general theory of auctions by analyzing bidding strategies in different auction forms, publishing his seminal papers around 1980.

Both professors at Stanford in the United States, Wilson was Milgrom's thesis advisor and they also live on the same street.

The academy noted that while "people have always sold things to the highest bidder," societies have also had to allocate "ever more complex objects... such as landing slots and radio frequencies" among users.

"In response, Milgrom and Wilson invented new formats for auctioning off many interrelated objects simultaneously, on behalf of a seller motivated by broad societal benefit rather than maximal revenue," the academy said.

They used their theories to create a new auction model that was put into practice by US authorities in 1994 to sell radio frequencies to telecom operators, and are applied by governments around the world in the current rollout of 5G networks.

The winners will share the prize sum of 10 million Swedish kronor (about $1.1 million, 950,000 euros).

Speaking to reporters in Stockholm via a telephone link, Wilson said the announcement had been "very happy news," conceding that despite his research focus he himself had "never participated in an auction".

However, he quickly had to retract his statement. "My wife is pointing out that we bought ski boots on eBay, I guess that was an auction," Wilson said.

David Ettinger, a professor of economics at the Paris Dauphine University, told AFP that while the word auction might conjure up images of auction houses like Sotheby's and Christie's, they are in fact ubiquitous, found in everything from online advertising to government contracts.

"Auctions have fascinated game theorists because it's rare to have applications in economic life where the terms are so clearly laid out. Negotiation is fuzzy, whereas in an auction... you make a bid and the best one wins," Ettinger said.



NEOM Nature Reserve Reintroduces Six Animal Species

NEOM is working to rebuild self-sustaining ecosystems through habitat rehabilitation, species recovery, and cutting-edge ecological monitoring - SPA
NEOM is working to rebuild self-sustaining ecosystems through habitat rehabilitation, species recovery, and cutting-edge ecological monitoring - SPA
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NEOM Nature Reserve Reintroduces Six Animal Species

NEOM is working to rebuild self-sustaining ecosystems through habitat rehabilitation, species recovery, and cutting-edge ecological monitoring - SPA
NEOM is working to rebuild self-sustaining ecosystems through habitat rehabilitation, species recovery, and cutting-edge ecological monitoring - SPA

As part of its bold rewilding strategy, NEOM has reintroduced more than 1,100 animals across six species to its expansive Nature Reserve—an important milestone in its broader mission to restore the region’s natural balance. With 95% of the region’s land preserved for nature, NEOM is working to rebuild self-sustaining ecosystems through habitat rehabilitation, species recovery, and cutting-edge ecological monitoring.

According to NEOM, when the Arabian Oryx was first reintroduced into the Nature Reserve in December 2022, it marked a milestone occasion, signifying the first time the animal had walked the sands of north-western Saudi Arabia for nearly 100 years, SPA reported.

In the early 1970s, the Oryx was extinct in the wild due to hunting and poaching, but conservation efforts across the region have seen its numbers swell in recent years, with more than 208 now calling NEOM home. Perfectly adapted to the region’s desert conditions, its white coat reflects the sun, while its complex nasal system cools the air it breathes and conserves water by recycling moisture as it exhales.

Another member of the Bovidae family, Arabian Sand Gazelles are petite, graceful animals that typically reside in sand dunes and coastal flats across the Arabian Peninsula. Gazelles are swift creatures, clocking speeds of up to 100 kilometers per hour in short bursts.

They are herbivores, and while NEOM’s regreening initiative continues to develop – with 4.7 million trees, shrubs, and grasses planted to date – the 530 Arabian Sand Gazelles currently residing in the reserve benefit from the natural vegetation that has returned to the area, following the removal of heavy livestock grazing. NEOM is also home to 223 Arabian Gazelles, which are typically darker in color and harder to find, preferring to reside in foothills and rugged mountain terrain.

Desert-dwelling wild goats can be found in NEOM’s rocky, mountainous terrain, and are typically recognized by their impressive arched horns. Males have backward-arched horns that can reach up to one meter in length, while females have much shorter horns and are lighter in color.

They are incredible climbers and have hooves with rubbery soles to act as suction cups on hard surfaces, aiding them in navigating steep cliffs to avoid predators, including wolves. NEOM has successfully reintroduced 53 Nubian Ibex to the reserve, adding to the population of several wild Ibex who have naturally returned to the area and are often caught on camera as part of NEOM’s monitoring program.

The red-necked ostrich, the largest and fastest living bird on earth, can stand up to 2.7 meters tall and weigh more than 150 kilograms. Their eggs are the largest of any living animal, measuring up to 15 centimeters long and up to 1.4 kilograms in weight. The bird gets its namesake from the fact that males have a reddish hue on their neck, especially in breeding season, when they perform an elaborate courtship display to attract females.

Currently, 27 chicks have been raised in NEOM Nature Reserve, which are well adapted to the region’s climate and feed on seeds, grass, leaves, and occasionally small insects or animals. Their strong legs allow them to run up to 70 kilometers per hour and, despite their size, red-necked ostriches are flightless.

Furthermore, the Lanner Falcon, last spotted in the wild in Saudi Arabia more than four decades ago, was reintroduced to NEOM Nature Reserve earlier this year in a momentous occasion. Known for its speed and agility, the Lanner Falcon can dive at speeds of more than 320 kilometers per hour. It has a striking appearance, with dark markings on its chest and belly, and a distinctive black moustache mark across its white face.

The release of Lanner Falcons into Bajdah at NEOM Nature Reserve forms part of a rewilding partnership between NEOM and the Saudi Falcon Club (SFC), which aims to reintroduce native falcon species within the Kingdom.