William Vickrey

William Vickrey

Born	(1914-06-21)21 June 1914 Victoria, British Columbia, Canada
Died	11 October 1996(1996-10-11) (aged 82) Harrison, New York, USA
Nationality	Canada
Institution	Columbia University
Field	Public economics
School/tradition	Post Keynesian economics
Alma mater	Columbia University Yale University
Influences	Robert Murray Haig Harold Hotelling John Maynard Keynes
Influenced	Jacques Drèze Harvey J. Levin Lynn Turgeon
Contributions	Vickrey auction Revenue equivalence theorem Congestion pricing
Awards	Nobel Memorial Prize in Economics (1996)
Information at IDEAS/RePEc

William Spencer Vickrey (21 June 1914 – 11 October 1996) was a Canadian-born professor of economics and Nobel Laureate. Vickrey was awarded the 1996 Nobel Memorial Prize in Economic Sciences with James Mirrlees for their research into the economic theory of incentives under asymmetric information. The announcement of the prize was made just three days prior to his death; his Columbia University economics department colleague C. Lowell Harriss accepted the prize posthumously on his behalf.

Biography

Early years

Vickrey was born in Victoria, British Columbia and attended high school at Phillips Academy in Andover, Massachusetts. After obtaining his B.S. in mathematics at Yale University in 1935, he went on to complete his masters in 1937 and doctoral studies in 1948 at Columbia University where he would remain for most of his career.

Career

Vickrey's paper, Counterspeculation, auctions and competitive sealed tenders, was the first of its kind using the tools of game theory to explain the dynamics of auctions. In his paper, Vickrey derives several auction equilibria, and provides an early revenue equivalence result. The revenue equivalence theorem remains the centrepiece of modern auction theory. The Vickrey auction is named after him.

He also did important work in congestion pricing, the idea that roads and other services should be priced so that users see the costs that arise from the service being fully used when there is still demand. Congestion pricing gives a signal to users to adjust their behaviour or to investors to expand the service in order to remove the constraint. His theory was later partially put into action in London.

In public economics, Vickrey extended the marginal cost pricing approach of Harold Hotelling.

Vickrey's economic philosophy was influenced by John Maynard Keynes and Henry George. He was sharply critical of the Chicago school of economics and the political focus on achieving balanced budgets and fighting inflation in times of high unemployment.

Vickrey had many graduate students and proteges at Columbia University, including the economists Jacques Drèze, Lynn Turgeon, and Harvey J. Levin.

Personal life

Vickrey was married to Cecile Thompson in 1951. He died in Harrison, New York in 1996 from heart failure. He was a Quaker and a member of Scarsdale Friends Meeting.

Works

• "Counterspeculation, Auctions, and Competitive Sealed Tenders" is a fundamental paper on auctions written by the Nobel Prize–winning economist William Vickrey in 1961. It has originated auction theory, a subfield of game theory (Bayesian games).

See also

• Vickrey auction
• Road pricing
• London congestion charge
• Electricity market
• List of economists
• List of think tanks

References

Much of Vickrey's work is collected in:

• Arrow, Kenneth Joseph; Vickrey, William S.; Arnott, Richard J.; Atkinson, Anthony A.; Drèze, Jacques (1997). Public Economics: Selected Papers by William Vickrey. Cambridge, UK: Cambridge University Press. ISBN 0-521-59763-3. 
• Pavlina R. Tcherneva; Vickrey, William S.; Forstater, Mathew (2004). Full Employment and Price Stability: The Macroeconomic Vision of William S. Vickrey. Edward Elgar Publishing. ISBN 1-84376-409-1. 
• Vickrey, William S.; Warner, Aaron W.; Forstater, Mathew; Rosen, Sumner M. (2000). Commitment to Full Employment: The Economics and Social Policy of William S. Vickrey. Armonk, N.Y: M.E. Sharpe. ISBN 0-7656-0633-X. 

External links

• Vickrey, William (October 5, 1996). "Fifteen Fatal Fallacies of Financial Fundamentalism: A Disquisition on Demand Side Economics". Paper was written one week before the author's death, three days before he received the Nobel Memorial Prize in Economics. 
• Nobel Laureate Biography of William Vickrey
• IDEAS/RePEc
• "William S. Vickrey (1914–1996)". The Concise Encyclopedia of Economics. Library of Economics and Liberty (2nd ed.) (Liberty Fund). 2008.