Nobel Economics Prize Awarded to Harvard Professor, MIT Educator

• 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
• The announcement Monday by the Royal Swedish Academy of Sciences said their work in contract theory is "valuable to the understanding of real-life contracts and institutions, as well as potential pitfalls in contract design
• The two will split the $924,000 prize. The laureates are set to officially receive the award on Dec. 10, the anniversary of prize founder Alfred Nobel's death in 1896

October 12, 2016: Oliver Hart of Harvard University and Bengt Holmstrom of the Massachusetts Institute of Technology have been awarded the 2016 Nobel Prize in Economic Sciences.

NewsGram brings to you current foreign news from all over the world.

The announcement Monday by the Royal Swedish Academy of Sciences said their work in contract theory is "valuable to the understanding of real-life contracts and institutions, as well as potential pitfalls in contract design."

NewsGram brings to you top news around the world today.

"This year's laureates have developed contract theory, a comprehensive framework for analyzing many diverse issues in contractual design, like performance-based pay for top executives, deductibles and co-pays in insurance, and the privatization of public-sector activities," the jury said.