The announcement of the 2020 Prize in Economic Sciences underlines the importance of auction theory. The Royal Swedish Academy of Sciences has decided to award the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel this year to Paul R. Milgrom and Robert B. Wilson (both Stanford University)
“for improvements to auction theory and inventions of new auction formats”.
Today we are surrounded by auctions not only for household objects, art and antiquities, but also securities, minerals and energy. The prize of electric power is set that way as well as carbon certificates or internet advertisements. The two Laureates Milgrom and Wilson have studied how auctions work. They have also used their insights to design new auction formats for goods and services that are difficult to sell in a traditional way, such as radio frequencies. Their discoveries have benefitted sellers, buyers and taxpayers around the world.
Our project NOBEL integrates an auctioning platform as novel mechanism for the sustainable supply of and payment for forest ecosystem services. This approach integrates common and private values of bidders concerning environmental and social issues. Our expert committee working on bidding rules and auction design is glad to step into such popular footsteps with its research.