A Stanford University professor raced to his sleeping colleague’s home at 2am and woke him up to let him know they had just won the Nobel Peace Prize in economics.
Paul R. Milgrom, 72, and Robert B. Wilson, 83, were awarded the prestigious prize on Monday as the winners were announced in Stockholm by Goran Hansson, secretary-general of the Royal Swedish Academy of Sciences.
‘Their discoveries ‘have benefitted sellers, buyers and taxpayers around the world,’ the Nobel Committee said.
Their auction formats have been used to sell radio frequencies, fishing quotas and airport landing slots.
But Milgrom almost missed the incredible moment because he was fast sleep inside his home in Stanford, California. Luckily, Wilson – who lives across the road – was on his way.
American economists Paul R. Milgrom, 72, (left) and Robert B. Wilson, 83, (right) were the Nobel Prize in economics for ‘improvements to auction theory and inventions of new auction formats.’
Doorbell camera footage shows Wilson, with his wife, rushing onto Milgrom’s front patio wearing only their pajamas.
Wilson rings the doorbell, knocks and event tries to turn the front doorknob numerous times in an attempt to stir the man.
‘Paul?’ Milgrom says when his colleague drowsily answers. ‘It’s Bob Wilson. You’ve won the Nobel Prize!’
Wilson adds that the Nobel Committee was trying to reach Milgrom’s phone, but could not get a hold of him because he’d unplugged it.
‘Wow,’ Milgrom says, stunned by the revelation.
Robert B. Wilson (center), pictured with his wife, traveled across the street to Paul Milgrom’s home after the Nobel Committee could not reach him on Monday morning
Wilson (center) rang the doorbell and knocked on the front door of Milgrom’s Stanford, California, until his colleague and friend woke up
While speaking with reporters later Monday morning, Milgrom admitted that he was asleep when the exciting news came in.
He called Wilson’s announcement ‘pretty good news’ and said it was a ‘surprising way to learn about it.’
Wilson confessed to reporters that he missed the Nobel Committee’s initial call, too,
‘Well, I made the mistake of thinking it was a political call and so I unplugged the phone. Then they called my wife’s cell phone,’ he said.
‘But we had kind of a comedy because Paul Milgrom, who lives just across the street from me, had turned off all of his phones, so the Nobel committee could not reach out.
‘So I had to come over and knock on the door in my pajamas to wake him up. So we had an encounter at the front door. ‘Hey Paul! You won the Nobel Peace Prize!”
Milgrom (left) speaking about Wilson (right): ‘What makes it a special pleasure, besides all the friends that are here, is winning this together with Bob’
During a Zoom call with their Stanford colleagues, Milgrom admitted that one of the best parts about winning the prize was doing so with Wilson.
‘What makes it a special pleasure, besides all the friends that are here, is winning this together with Bob,’ he said.
‘Bob was my PhD dissertation advisor. [He] introduced me to the study of auctions as a way to study markets and resource allocations right at the beginning of my research career.’
The European Union has even used their theories and methodology to auction emission allowances to combat climate change.
Milgrom is a professor of humanities and sciences at the Stanford University economics department while Wilson is a professor emeritus of management at Stanford Business School.
Wilson described his former student as ‘sort of the genius behind all of this auction work,’ noting that they first worked together on auctions in the 1970s.
Their discoveries ‘have benefitted sellers, buyers and taxpayers around the world,’ the Nobel Committee said. Their auction formats have been used to sell radio frequencies, fishing quotas and airport landing slots
‘We’re really motivated to use theory in a very practical way to improve various economic processes,’ Wilson said.
Wilson’s work focused on the theory of common value, the best estimate of what an item is worth that bidders try to bid below it to avoid overpaying.
Milgrom’s work analyzed bidding strategies to determine how the format of an auction can give the seller higher expected revenue as bidders estimate the ‘private value’ others place on the auction items.
Together, they created new auction formats that were adopted by American authorities in 1994 to sell radio frequencies to telecom operators.
Tommy Andersson, a member in The Prize Committee for the Alfred Nobel Memorial Prize in Economic Sciences speaks during the announcement of the winners Monday at the Royal Swedish Academy of Sciences in Stockholm
Speaking to reporters in Stockholm by phone after learning of his win, Wilson struggled to think of an auction he himself had participated in. But then added: ‘My wife points out to me that we bought ski boots on eBay. I guess that was an auction.’
Technically known as the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, the award was established in 1969 and is now widely considered one of the Nobel prizes.
Last year’s award went to two researchers from the Massachusetts Institute of Technology and a third from Harvard University, for their groundbreaking research into efforts to reduce global poverty.
The prestigious award comes with a $1.1million cash prize and a gold medal.
The face of the Nobel Prize meda shows Alfred Nobel, a Swedish chemist, engineer, inventor, businessman, and philanthropist
‘There’s not much I can use it for, in terms, you know, travel or something. Probably I’ll just save it for my wife, my children,’ Wilson said.
Last week, the Nobel Committee awarded the prize for physiology and medicine for discovering the liver-ravaging hepatitis C virus.
Tuesday’s prize for physics honored breakthroughs in understanding the mysteries of cosmic black holes, and the chemistry prize on Wednesday went to scientists behind a powerful gene-editing tool.
The literature prize was awarded to American poet Louise Gluck on Thursday for her ‘candid and uncompromising’ work. The World Food Programme won the Nobel Peace Prize on Friday for its effort to combat hunger worldwide.