Americans Alvin Roth and Lloyd Shapley have won the Nobel economics prize for this year.

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

Their research focuses on how to match different economic agents such as students for schools or even organ donors with patients. 

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

The award citation said Shapley had used game theory to study and compare various matching methods and how to make sure the matches were acceptable to all counterparts, including the creation of a special algorithm.

Roth followed up on Shapley's results in a series of empirical studies and helped redesign existing institutions so that new doctors could be matched with hospitals, students with schools or patients with organ donors.

The Nobel Memorial Prize in Economic Sciences was the last of the 2012 Nobel awards to be announced.

It is not technically a Nobel Prize, because unlike the five other awards it was not established in the will of Alfred Nobel, a Swedish industrialist also known for inventing dynamite.

The economics prize was created by the Swedish central bank in Nobel's memory in 1968, and has been handed out with the other prizes ever since.

Each award is worth 8 million Swedish kronor, or almost €1m.

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.

Last week, the European Union won the Nobel Peace Prize for its historic role in uniting the continent in an award meant as a morale boost for the bloc as it struggles to resolve its debt crisis.

The EU has been a key in transforming Europe "from a continent of wars to a continent of peace," Committee chairman Thorbjoern Jagland said.

"This is a message to Europe to do everything they can to secure what they've achieved and move forward," Jagland said, adding it was a reminder of what would be lost "if the union is allowed to collapse".

He praised the 27-nation EU for rebuilding after World War Two and for its role in spreading stability after the 1989 fall of the Berlin Wall.