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.[4] He served as an associate professor at the Kellogg Graduate School of Management at Northwestern University (1979–1983)[4] and as the Edwin J. Beinecke Professor of Management at Yale University’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.[4]
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.[6] More generally, he has worked on the theory of contracting and incentives especially as applied to the theory of the firm, to corporate governance and to liquidity problems in financial crises. He praised the taxpayer-backed bailouts by the US government during the financial crisis of 2007–2008 and emphasizes the benefits of opacity in the money market.[7]
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.
He is married to Anneli Holmström[13] and they have one son.[3]
Publications
Holmström, Bengt, 1972. "En icke-linear lösningsmetod för allokationsproblem". University of Helsinki.
Holmström, Bengt, 1979. "Moral Hazard and Observability," Bell Journal of Economics, 10(1), pp. 74–91.
Holmstrom, Bengt. "Moral hazard in teams." The Bell Journal of Economics (1982): 324–340.
Holmstrom, Bengt. "Equilibrium long-term labor contracts." The Quarterly Journal of Economics (1983): 23–54. 23
Holmström, B., 1999. Managerial incentive problems: A dynamic perspective. The Review of Economic Studies, 66(1), pp. 169–182.169–182
Holmström, Bengt, and Paul Milgrom, 1991. "Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design," Journal of Law, Economics, and Organization, 7, 24–52.
Holmstrom, B. and Milgrom, P., 1994. The firm as an incentive system. The American Economic Review, pp. 972–991. 972–991.
Holmström, Bengt, and John Roberts, 1998. "The Boundaries of the Firm Revisited," Journal of Economic Perspectives, 12(4), pp. 73–94
Holmström, Bengt, and Jean Tirole, 1998. "Private and Public Supply of Liquidity," Journal of Political Economy, 106(1), pp. 1–40.
References
^Levin, Jonathan David (1999). Relational contracts, incentives and information (Ph.D.). MIT. hdl:1721.1/9520.