Nobel Prize Winners Studied Agreements Affecting Everyone
Two professors at American universities have won the Nobel Prize in Economic Sciences. They were honored for their work on business agreements that affect billions of people worldwide: contracts.
"The Royal Swedish Academy of Sciences has decided to award the Sveriges Richsbank Prize in Economic Sciences in Memory of Alfred Nobel for 2016 to Oliver Hart and Bengt Holmstrom for their contributions to contract theory."
Goran Hansson, the Secretary General of the Royal Swedish Academy of Sciences announced the prize Monday.
Oliver Hart is a professor at Harvard University. Bengt Holmstrom is at the nearby Massachusetts Institute of Technology, or M.I.T.
The Royal Swedish Academy of Sciences said the prize was awarded for work on the theory of contracts. These agreements affect almost every part of modern life.
Contracts are everywhere
Insurance, loans, buying agreements, employment, property rights, political constitutions and marriage are all kinds of contracts.
Hart and Holmstrom developed a theory for understanding how contracts work. Their research has been used to design contracts. It relates to contracts in private markets and in public policy.
Contracts are agreements between a principal and an agent. One example of this relationship is the one between an employer and an employee.
The leader of a company and its shareholders also have a contractual agreement.
Hart and Holmstrom's work raised questions about tying the pay of high-level officials to a company's current profits. They found that performance-based pay might not be the best policy in some cases. Doing so, may give a business leader an incentive to make decisions that increase profits for a short period of time. Those same decisions may harm the company over the long term.
The two also studied insurance contracts. They argued that people may become careless if insurance companies fully replaced things that are damaged in an accident, such as cars. So, insurance companies often have contract holders pay a deductible toward repair. Insurers also limit what they are willing pay for or replace in many cases.
Holmstrom worked with others to describe how contracts meant to improve one kind of performance can hurt overall job performance. For example, if teacher pay is tied to student test scores then many other parts of a teacher's job could be negatively affected.
Hart and Holmstrom worked together to show that contracts cannot describe every part of a job. Contracts are in some ways always incomplete.
The two said contracts cannot predict every need and requirement in the future. Holmstrom researched the subject for many years. He advised that contracts should make clear what needs to be done to deal with future disagreements between parties rather than center on specific requirements.
The new Nobel prize winners also examined whether some jobs are better done by government or private industry.
In 1997, Hart worked with others in a study that showed the incentive to reduce costs is usually stronger among private contractors. The research called into question the policy of some privately run public services, like prisons.
The Nobel committee praised Hart and Holmstrom for providing the tools to think about and design better contracts in many different fields.
Oliver Hart was born in London. He spent much of his professional life at American universities. Co-winner Bengt Holmstrom was born in Helsinki, Finland. He also spent most of his career in the United States.
The two have been friends for years. The Nobel Prize committee's twitter account Tweeted Hart's reaction:
The two will share the economics prize worth $924,000. It is the only Nobel prize not established by Alfred Nobel. Sweden's central bank established the prize in his honor.
The Nobel prize for literature will be announced Thursday.
I'm Mario Ritter.
1.business agreements 商业协定
The arranging of this business agreement is a top priority.
2.public services 公共服务
The money is used by local authorities to pay for public services.
3.deal with 处理
We often deal with him.
4.test score 考试分数
Our teacher omitted our lowest test score when computing our grades.
1.Contracts are in some ways always incomplete.
in some ways 在某些方面
In some ways we wish we could turn the clock back.
In some ways, the official opening is a formality.
2.For example, if teacher pay is tied to student test scores then many other parts of a teacher's job could be negatively affected.
tied to 与...相关联；寄；缠
There was a piece of cloth tied to the dog's collar
I am tied to my work all day.
美国两位大学教授获得了诺贝尔经济学奖 。该奖项是为了表彰两人在影响全球数十亿人的契约理论方面所做的贡献 。
“瑞典皇家科学院决定将2016年瑞典国家银行纪念阿尔弗雷德·诺贝尔经济学奖授予奥利弗·哈特（Oliver Hart）以及本特·霍尔姆斯特伦（Bengt Holmstrom）来表彰他们对契约理论所做出的贡献 。”
周一，瑞典皇家科学院秘书长格兰·汉松（Goran Hansson）宣布了这一奖项的得主 。
瑞典皇家科学院表示，该奖项是为了表彰其在契约理论方面的贡献 。契约理论几乎影响现代生活的方方面面 。
哈特和霍尔姆斯特伦研发了一套契约如何起作用的理论 。他们的研究已被用来设计各种契约 。涉及到私营市场和公共政策中的各种契约 。
契约关系是指当事人与代理人之间的协议 。雇主和雇员的关系就是典型的例子 。
哈特和霍尔姆斯特伦提出将高管薪酬与公司当前利润挂钩的问题 。他们发现，某些情况下，以绩效为基础的薪酬可能不是最佳策略 。短期内，这一做法或许可以激励企业领导做出增涨公司利润的决定 。长远来看，这些决定可能会损害公司利益 。
两人还对保险契约进行了研究 。他们指出，若保险公司完全更换事故中受损的汽车等物品，那么人们可能会变得粗心 。因此，保险公司通常会让投保人在维修中承担一项免赔额 。很多情况下，保险公司还会在赔偿或更换方面有所限制 。
霍尔姆斯特伦与他人携手对契约在提高某方面绩效却会损害整体效益一事上作出阐述 。例如，若教师薪酬与学生考试分数挂钩，那么教师的其它多项工作获将受到负面影响 。
哈特和霍尔姆斯特伦合力证明契约无法描述工作的每个细节 。从某些方面讲，契约是不完整的 。
两人均表示，契约无法预测未来的具体需求 。多年来，霍尔姆斯特伦一直研究契约理论 。他指出，契约是为了应对未来双方发生的分歧，而不是服务于某种具体要求 。
1997年，哈特曾在一项研究中与别人合作，该研究表明，私营承包商降低成本的动机更大 。该研究对一些私营公共服务领域提出了质疑，如监狱 。
哈特出生于伦敦，他的职业生涯多半是在美国大学度过的 。而获奖者霍尔姆斯特伦出生在芬兰赫尔辛基，他的职业生涯也是在美国度过的 。
两人时多年挚友 。诺贝尔奖委员会的推特发文谈及哈特的反应 。
这两人将共享诺贝尔经济学奖，奖金达92.4万美元 。这是唯一一项非诺贝尔本人设立的诺贝尔奖项 。为了纪念诺贝尔，瑞典国家银行创立了该奖项 。