Harvard professor Oliver Hart and MIT's Bengt Holström on 10 October were awarded the Noble Memorial Prize in Economic Sciences for their work on contract theory, the study of how people can efficiently enter into agreements.
According to Washington Post, Hart and Holström's contribution have shaped the thinking of a wide range of fields including law, economics, and political science.
Oliver Hart, 68, who was born in Britain, teaches economics at Harvard and Finnish-born Holström, 67, teaches at MIT. The two professors will share the Noble Prize and split the 8 million Swedish Krona award ( around $925,000).
Last year, Princeton economist Angus Deaton had won the award for his research on how people, particularly the poor, make decisions about spending money.