Bengt Robert Holmström (born 18 April 1949) is a Finnish

economist An economist is a professional and practitioner in the social sciences, social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy. Within this ...

who is currently Paul A. Samuelson Professor of Economics (Emeritus) at the

Massachusetts Institute of Technology The Massachusetts Institute of Technology (MIT) is a Private university, private research university in Cambridge, Massachusetts, United States. Established in 1861, MIT has played a significant role in the development of many areas of moder ...

. Together with Oliver Hart, he received the Central Bank of Sweden

Nobel Memorial Prize in Economic Sciences The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (), commonly referred to as the Nobel Prize in Economics(), is an award in the field of economic sciences adminis ...

in 2016.

Early life and education

Holmström was born in Helsinki, Finland, on 18 April 1949, and belongs to the Swedish speaking minority of Finland. He received his B.S. in mathematics and science from the

University of Helsinki The University of Helsinki (, ; UH) is a public university in Helsinki, Finland. The university was founded in Turku in 1640 as the Royal Academy of Åbo under the Swedish Empire, and moved to Helsinki in 1828 under the sponsorship of Alexander ...

in 1972. He also received a

Master of Science A Master of Science (; abbreviated MS, M.S., MSc, M.Sc., SM, S.M., ScM or Sc.M.) is a master's degree. In contrast to the Master of Arts degree, the Master of Science degree is typically granted for studies in sciences, engineering and medici ...

degree in

operations research Operations research () (U.S. Air Force Specialty Code: Operations Analysis), often shortened to the initialism OR, is a branch of applied mathematics that deals with the development and application of analytical methods to improve management and ...

from

Stanford University Leland Stanford Junior University, commonly referred to as Stanford University, is a Private university, private research university in Stanford, California, United States. It was founded in 1885 by railroad magnate Leland Stanford (the eighth ...

in 1975. He received his Ph.D. from the Graduate School of Business at Stanford in 1978. He moved to the United States in 1976.

Career

He worked as a corporate planner from 1972 until 1974, then was an assistant professor at the Hanken School of Economics from 1978 until 1979. He served as an associate professor at the Kellogg Graduate School of Management at

Northwestern University Northwestern University (NU) is a Private university, private research university in Evanston, Illinois, United States. Established in 1851 to serve the historic Northwest Territory, it is the oldest University charter, chartered university in ...

(1979–1983) and as the Edwin J. Beinecke Professor of Management at

Yale University Yale University is a Private university, private Ivy League research university in New Haven, Connecticut, United States. Founded in 1701, Yale is the List of Colonial Colleges, third-oldest institution of higher education in the United Stat ...

’s School of Management (1983–1994). Holmström was elected Alumnus of The Year by the University of Helsinki Alumni Association in 2010. He has been on the faculty of M.I.T. since 1994, when he was appointed professor of economics and management at the department of economics and Sloan School of Management. Holmström is particularly well known for his work on principal-agent theory. His work made seminal advances in understanding contracting in the presence of uncertainty. More generally, he has worked on the theory of contracting and incentives especially as applied to the

theory of the firm The theory of the firm consists of a number of economic theories that explain and predict the nature of the firm, company, or corporation, including its existence, behaviour, structure, and relationship to the market. Firms are key drivers in eco ...

, to corporate governance and to liquidity problems in financial crises. He praised the taxpayer-backed bailouts by the US government during the

2008 financial crisis The 2008 financial crisis, also known as the global financial crisis (GFC), was a major worldwide financial crisis centered in the United States. The causes of the 2008 crisis included excessive speculation on housing values by both homeowners ...

and emphasizes the benefits of opacity in the

money market The money market is a component of the economy that provides short-term funds. The money market deals in short-term loans, generally for a period of a year or less. As short-term securities became a commodity, the money market became a compo ...

. Holmström was elected member of the

Finnish Society of Sciences and Letters The Finnish Society of Sciences and Letters (, , ) is a Finnish learned society for natural sciences, social sciences and humanities. It is a bilingual (Swedish and Finnish) science academy and the oldest of the four science academies in Finland. ...

in 1992 and an honorary member of the same society in 2016. He is a fellow of the

American Academy of Arts and Sciences The American Academy of Arts and Sciences (The Academy) is one of the oldest learned societies in the United States. It was founded in 1780 during the American Revolution by John Adams, John Hancock, James Bowdoin, Andrew Oliver, and other ...

, the

Econometric Society The Econometric Society is an international society of academic economists interested in applying statistical tools in the practice of econometrics. It is an independent organization with no connections to societies of professional mathematicians o ...

, the

European Economic Association The European Economic Association (EEA) is a learned society, professional academic body which links European economists. It was founded in the mid-1980s. Its first annual congress was in 1986 in Vienna and its first president was Jacques Drèze. ...

and the American Finance Association, and a foreign member of the

Royal Swedish Academy of Sciences The Royal Swedish Academy of Sciences () is one of the Swedish Royal Academies, royal academies of Sweden. Founded on 2 June 1739, it is an independent, non-governmental scientific organization that takes special responsibility for promoting nat ...

and the Finnish Academy of Science and Letters. In 2011, he served as President of the Econometric Society. He holds honorary doctorate degrees from the Stockholm School of Economics, Sweden, the

University of Vaasa The University of Vaasa (, ) is a multidisciplinary, business-oriented university in Vaasa, Finland. The campus of the university is situated by the Gulf of Bothnia adjacent to downtown Vaasa. The university has evolved from a school of econom ...

and the Hanken School of Economics in Finland. Holmström was a member of

Nokia Nokia Corporation is a Finnish multinational corporation, multinational telecommunications industry, telecommunications, technology company, information technology, and consumer electronics corporation, originally established as a pulp mill in 1 ...

board of directors A board of directors is a governing body that supervises the activities of a business, a nonprofit organization, or a government agency. The powers, duties, and responsibilities of a board of directors are determined by government regulatio ...

from 1999 until 2012. He was a member of the Board of the

Aalto University Aalto University (; ) is a public university, public research university located in Espoo, Finland. It was established in 2010 as a merger of three major Finnish universities: the Helsinki University of Technology, the Helsinki School of Economic ...

from 2008 until 2017.Aalto University site
from MIT.

Accolades

He was awarded the 2012 Banque de France-TSE Senior Prize in Monetary Economics and Finance, the 2013 Stephen A. Ross Prize in Financial Economics and the 2013 Chicago Mercantile Exchange – MSRI Prize for Innovative Quantitative Applications. In 2016, Holmström won the

Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel (), commonly referred to as the Nobel Prize in Economics(), is an award in the field of economic sciences adminis ...

together with Oliver Hart "for their contributions to

contract theory From a legal point of view, a contract is an institutional arrangement for the way in which resources flow, which defines the various relationships between the parties to a transaction or limits the rights and obligations of the parties. From an ...

Personal life

He is married to Anneli Holmström and they have one son.

Publications

* * * * Republished from * * * * * Republished from

References

External links

* including the Prize Lecture 8 December 2016 ''Pay for Performance and Beyond'' , - {{DEFAULTSORT:Holmstrom, Bengt R. 1949 births Living people Finnish business theorists 20th-century Finnish economists Finnish Nobel laureates Game theorists Information economists Stanford Graduate School of Business alumni Stanford University alumni MIT Sloan School of Management faculty Members of the Royal Swedish Academy of Sciences Fellows of the American Academy of Arts and Sciences Fellows of the Econometric Society Presidents of the Econometric Society Swedish-speaking Finns Nokia people Finnish expatriates in the United States Nobel laureates in Economics 21st-century Finnish economists MIT School of Humanities, Arts, and Social Sciences faculty Fellows of the European Economic Association People from Helsinki