<div>British-American economist Oliver Hart and Bengt Holmstrom of Finland today won the Nobel Economics Prize for their work on contract theory, the jury said.<br /><br />"This year's laureates have developed contract theory, a comprehensive framework for analysing many diverse issues in contractual design, like performance-based pay for top executives, deductibles and co-pays in insurance, and the privatisation of public-sector activities," it said.<br /><br />"The new theoretical tools created by Hart and Holmstrom are valuable to the understanding of real-life contracts and institutions, as well as potential pitfalls in contract design."<br /><br />Their groundbreaking work has laid "an intellectual foundation" for designing policies and institutions in many areas, from bankruptcy legislation to political constitutions.<br /><br />Hart, born in 1948, is an economics professor at Harvard University in the United States, while Holmstrom is a professor of economics and management at Massachusetts Institute of Technology.<br /><br />The pair will share the eight million kronor (826,000 euros, USD 924,000) prize.<br /><br />Last year, the award went to US-British researcher Angus Deaton for his groundbreaking work on poverty.<br /><br />The economics prize is unique among the Nobel awards in that it was created by the Swedish central bank in 1968 -- the others were all set up through the 1895 will of Swedish inventor and philanthropist Alfred Nobel.<br /><br />The economics prize is the fifth of the six Nobel prizes to be announced this year.<br /><br />Last week, the awards for medicine, physics, and chemistry were announced, as well as the peace prize, which went to Colombia's President Juan Manuel Santos for his efforts to end a half-century war with the FARC rebels.<br /><br />The final prize, for literature, will be announced Thursday.<br /><br />For that award, the Swedish Academy could tap a superstar novelist such as Philip Roth of the United States or Haruki Murakami of Japan, or a lesser-known writer such as Norwegian playwright Jon Fosse or Syrian poet Adonis.<br /><br />The Nobel prize consists of a diploma, a gold medal and cheque for eight million Swedish kronor (828,000 euros, USD 928,000), which the laureates will receive at a ceremony in Stockholm on December 10.</div>
<div>British-American economist Oliver Hart and Bengt Holmstrom of Finland today won the Nobel Economics Prize for their work on contract theory, the jury said.<br /><br />"This year's laureates have developed contract theory, a comprehensive framework for analysing many diverse issues in contractual design, like performance-based pay for top executives, deductibles and co-pays in insurance, and the privatisation of public-sector activities," it said.<br /><br />"The new theoretical tools created by Hart and Holmstrom are valuable to the understanding of real-life contracts and institutions, as well as potential pitfalls in contract design."<br /><br />Their groundbreaking work has laid "an intellectual foundation" for designing policies and institutions in many areas, from bankruptcy legislation to political constitutions.<br /><br />Hart, born in 1948, is an economics professor at Harvard University in the United States, while Holmstrom is a professor of economics and management at Massachusetts Institute of Technology.<br /><br />The pair will share the eight million kronor (826,000 euros, USD 924,000) prize.<br /><br />Last year, the award went to US-British researcher Angus Deaton for his groundbreaking work on poverty.<br /><br />The economics prize is unique among the Nobel awards in that it was created by the Swedish central bank in 1968 -- the others were all set up through the 1895 will of Swedish inventor and philanthropist Alfred Nobel.<br /><br />The economics prize is the fifth of the six Nobel prizes to be announced this year.<br /><br />Last week, the awards for medicine, physics, and chemistry were announced, as well as the peace prize, which went to Colombia's President Juan Manuel Santos for his efforts to end a half-century war with the FARC rebels.<br /><br />The final prize, for literature, will be announced Thursday.<br /><br />For that award, the Swedish Academy could tap a superstar novelist such as Philip Roth of the United States or Haruki Murakami of Japan, or a lesser-known writer such as Norwegian playwright Jon Fosse or Syrian poet Adonis.<br /><br />The Nobel prize consists of a diploma, a gold medal and cheque for eight million Swedish kronor (828,000 euros, USD 928,000), which the laureates will receive at a ceremony in Stockholm on December 10.</div>