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.



Berliners Jump into the Spree River to Show It’s Clean Enough for Swimming 

People swim in the river Spree to demand the lift of the hundred years old swimming ban at the river in front of the Berlin Cathedral and the TV Tower in Berlin, Germany, Tuesday, June 17, 2025. (AP)
People swim in the river Spree to demand the lift of the hundred years old swimming ban at the river in front of the Berlin Cathedral and the TV Tower in Berlin, Germany, Tuesday, June 17, 2025. (AP)
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Berliners Jump into the Spree River to Show It’s Clean Enough for Swimming 

People swim in the river Spree to demand the lift of the hundred years old swimming ban at the river in front of the Berlin Cathedral and the TV Tower in Berlin, Germany, Tuesday, June 17, 2025. (AP)
People swim in the river Spree to demand the lift of the hundred years old swimming ban at the river in front of the Berlin Cathedral and the TV Tower in Berlin, Germany, Tuesday, June 17, 2025. (AP)

A century after the city of Berlin banned swimming in the Spree River because it was so polluted it could make people sick, there's a push by swimmers to get back into the water.

Around 200 people jumped into the slow-moving, greenish water Tuesday to show that it's not only clean enough, but also lots of fun to splash and swim in the Mitte neighborhood along the world-famous Museum Island.

A group calling itself Fluss Bad Berlin, or River Pool Berlin, has been lobbying for years to open the meandering river for swimmers again.

“For 100 years now, people have not been allowed to swim in the inner-city Spree and we no longer think this is justified, because we can show that the water quality is usually good enough to go swimming during the season,” said Jan Edler, who is on the board of Fluss Bad Berlin and helped organize Tuesday's swim-in.

To circumvent the ban, the group registered their collective swim event as an official protest.

Standing on a little staircase that leads down to the Spree canal, which flows around the southern side of the island, Edler stressed that “we want the people to use the Spree for recreation again.”

He pointed to the fact that the river has been cleaned up thoroughly, and that the water quality has improved in the last decade and is constantly being monitored.

Even city officials in the central Mitte district of Berlin say they'd be interested in introducing river swimming again in 2026.

“There are still many things that need to be clarified, but I am optimistic that it can succeed,” district city councilor Ephraim Gothe told German news agency dpa recently.

Supporters of lifting the swimming ban also point at Paris, where the Seine River was opened up for swimmers for the Olympic Games last year and will be opened this summer for Parisians. Swimming there had been banned since 1923.

In Vienna, too, water lovers can splash into the Danube River canal, in the Swiss city of Basel they can bathe in the Rhine, and in Amsterdam there are some designated areas where people can plunge into the canals.

Only in Berlin, swimming has been continuously prohibited in the Spree since May 1925, when the German capital closed all traditional river pools because the water was deemed too toxic. Some of those pools weren't only used for recreational swimming, but were a place for poor people to wash themselves if they didn't have bathrooms at home.

These days, the water is clean on most days, except when there's heavy rain, which leads to some water pollution.

Allowing swimmers to dive into the river would also mean loosening the historical monument protection on some parts of the riverbanks to install easy access ways to the water and places for lifeguards.

Another problem is the busy boat traffic on the Spree that could endanger swimmers. However, for the time being, the Fluss Bad Berlin group only wants to open up nearly 2-kilometer-long (just over a mile-long) canal where there's no boat traffic.

For what it's worth, the German capital, a city of 3.9 million, could definitely need more places where people can cool off in the summer as regular outdoor pools tend to be hopelessly overcrowded on hot summer days.

“The cities are getting hotter,” Edler said. “It's also a question of environmental justice to create offers for people who just can’t make it out of the city when it’s so hot and can enjoy themselves in the countryside.”