US pair wins Nobel economics prize

STOCKHOLM // The Nobel Prize in economics was awarded yesterday to the Americans Alvin Roth and Lloyd Shapley.

The Royal Swedish Academy of Sciences cited them for "the theory of stable allocations and the practice of market design".

Their research helps to explain market processes at work when doctors are assigned to hospitals, students to schools and human organs for transplant.

"This year's prize concerns a central economic problem: how to match different agents as well as possible," the academy said.

Mr Roth, 60, is a professor at Harvard University in Boston. Mr Shapley, 89, is a professor emeritus at the University of California, Los Angeles.

Mr Shapley made early theoretical contributions to the field of study, and Mr Roth took it further by applying it to the market for doctors in the United States.

"Even though these two researchers worked independently of one another, the combination of Shapley's basic theory and Roth's empirical investigations, experiments and practical design has generated a flourishing field of research and improved the performance of many markets," the academy said.

The prize was the last of the 2012 Nobel awards. Last year's economics prize went to US economists Thomas Sargent and Christopher Sims for describing the cause-and-effect relationship between the economy and government policy.