STOCKHOLM â Two Americans and a British-Cypriot economist won the 2010 Nobel economics prize Monday for developing a theory that helps explain how many people can remain unemployed despite a large number of job vacancies.
Diamond â a former mentor to current Federal Reserve chairman Ben Bernanke â analyzed the foundations of so-called search markets, while Mortensen and Pissarides expanded the theory and applied it to the labor market.
President Barack Obama nominated Diamond to become a member of the Federal Reserve, but the Senate failed to approve his nomination before lawmakers left to campaign for the midterm congressional elections.
Bernanke was one of Diamond's students at MIT. When Bernanke turned in his doctoral dissertation in 1979, one of the people he thanked was Diamond for being generous with his time and reading and discussing Bernanke's work.
And Pissarides is a member of the Central Bank of Cyprus Monetary Policy Committee.