- Title: UK, Finland-born economists win 2016 Nobel Prize for Economics
- Date: 10th October 2016
- Summary: (SOUNDBITE) (English) CHAIRMAN OF THE ECONOMIC PRIZE COMMITTEE, PER STROMBERG, SAYING (AUDIO OVERLAYS SHOT OF 'CONTRACTS ARE EVERYWHERE IN SOCIETY' PROJECTION): "This is very fundamental and the theories that Hart and Holmstrom have developed are incredibly important for us to understand these types of contracts and institutions." STROMBERG SPEAKING / HANSSON, SJOSTROM SEATED
- Embargoed: 25th October 2016 12:02
- Keywords: Nobel prize economics
- Location: STOCKHOLM, SWEDEN
- City: STOCKHOLM, SWEDEN
- Country: Sweden
- Topics: Science
- Reuters ID: LVA00353FAD6V
- Aspect Ratio: 16:9
- Story Text: British-born Oliver Hart and Finland-born Bengt Holmstrom won the 2016 Nobel Economics Prize for their contributions to contract theory on Monday (October 10), helping the understanding of issues like the performance-based pay for top executives.
The Royal Swedish Academy of Sciences said on announcing the 8 million Swedish crown ($928,000) prize that their work laid an intellectual foundation for designing policies and institutions in many areas, from bankruptcy legislation to political constitutions.
Hart is economics professor at Harvard University while Holmstrom is professor of economics and management at the Massachusetts Institute of Technology.
Hart's work has helped understanding which companies should merge and the right mix of financing and when institutions such as schools should be privately or publicly owned, the academy said in a statement.
Holmstrom's work helped how to formulate contracts for executives, the statement added.
The economics prize, officially called the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, was established in 1968. It was not part of the original group of awards set out in dynamite tycoon Nobel's 1895 will.
Economics is the fifth of this year's Nobels. The prizes for physiology or medicine, physics, chemistry and peace were awarded last week. The literature prize is due on Thursday.
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