Dale T. Mortensen ‘61 became Willamette’s first Nobel laureate when he was awarded the 2010 Nobel Prize in Economics for his "analysis of markets with search frictions." He shared the award with Christopher Pissarides, professor at the London School of Economics, and Peter Diamond, an economist at the Massachusetts Institute of Technology and Federal Reserve board nominee.
In an interview with Nobel Web, Mortensen described these frictions as "deviation from so-called perfect markets, which is an ideal." In these perfect markets, participants have perfect information; one example of such information is knowing for certain the price of a good or service.
Mortensen applied his critical eye to wages and unemployment, two extremely relevant topics in the U.S. today. "Your alternative to making a deal is important," said Mortensen. "There's some wage you wouldn't accept because you'd rather go find another opportunity."
This "search friction" affects wages and the number of workers a business may hire.
Professor Per Krusell, member of the prize committee, noted the importance of the winners' work for policymakers and called it "the first full theory of unemployment and how it evolves over time."
After graduating with a bachelor's in economics from Willamette in 1961, Mortensen earned his doctorate from Carnegie-Mellon University in 1967. Although he has been on the faculty of Northwestern University since 1965, he has also held visiting appointments at the University of Essex, Hebrew University, New York University, California Institute of Technology, and Cornell University, as well as visiting research appointments at Central Institute of Mathematics-Economics in Moscow, Russia, the Centre for Labor and Social Research in Aarhus, Denmark, and the Research School of Social Sciences, The Australian National University.