Dale Mortensen

Dale Mortensen shared the 2010 Nobel Memorial Prize in Economic Sciences with Peter Diamond and Christopher Pissarides. They were awarded the prize for developing the search and matching theory to explain how unemployment is affected by market frictions. Their model shows why job vacancies and unemployment can coexist.

The Mortensen-Pissarides model is a foundational framework in labor economics used to analyze the dynamics of unemployment and job vacancies. It explains how the time-consuming process of matching workers with suitable employers creates frictional unemployment. It is a core component of modern macroeconomic theory.

Dale Mortensen spent the majority of his academic career as a professor at Northwestern University. He was closely affiliated with the university's Department of Economics for several decades. He conducted his Nobel-winning research on labor markets while based at this institution.

Mortensen's search theory shows that finding a job or an employee takes time and resources due to imperfect information and geographic mismatches. Even when an economy is recovering, these market frictions mean that workers and employers cannot instantly match. This explains why the unemployment rate never truly hits zero in a healthy economy.