Our warmest congratulations to Lloyd Shapley, who today shared the 2012 Nobel Prize in Economics with Alvin Roth (Harvard)!
The citation reads that the prize was awarded "for the theory of stable allocations and the practice of market design". Professor Shapley, in joint work with David Gale (UC Berkeley, 1921-2008), provided the theoretical fundamentals. Their 1962 paper "College admissions and stability of marriage" explained how to match two groups of people (e.g., men and women in the "marriage market") in a way that is stable. Professor Roth confirmed the applicability of this theory through a series of laboratory experiments; this has led to a number of applications. For example, the theory of "market design" has been used in college admissions, allocations of new doctors to medical schools, assignments of children to public schools, and even in organ donation.
Professor Shapley joined UCLA in 1981, holding a joint position in the economics and mathematics department. He has been professor emeritus since 2000.