American economists Paul R Milgrom and Robert B Wilson have been awarded the 2020 Nobel Prize in Economics for improving auction theory and inventions of new auction formats.

Economists have studied how auctions work, designing new auction formats for goods and services that are difficult to sell in traditional ways, such as radio frequencies.

The Nobel Committee said that their discoveries have benefited sellers, buyers, and taxpayers around the world.

The prestigious award comes with a cash prize of 10 million kronor (€960,000) and a gold medal.

This is the final Nobel Prize to be announced this year.

The committee said Wilson's work showed "why rational bidders tend to place bids below their own best estimate of the common value," that is, "a value that is previously uncertain but ultimately the same for all."

"(Bidders) are concerned about the curse of the winner — that is, paying too much and losing out," the committee said.

Milgrom has developed a more general auction theory that takes into account what is known as the "private value" of what is sold that can vary greatly from bidder to bidder.

Last year's award went to two researchers from the Massachusetts Institute of Technology and a third from Harvard University for their groundbreaking research into global poverty alleviation.

On Monday, the Nobel Committee was awarded the Physiology and Medicine Award for Discovery of the Hepatic Hepatitis C Virus.

Tuesday's Physics Award honored breakthroughs in understanding the mysteries of cosmic black holes, and Wednesday's Chemistry Award went to scientists behind a powerful gene-editing tool.

On Thursday, the Literature Prize was awarded to the American poet Louise Glück for her "candid and uncompromising" work.

On Friday, the World Food Program won the Nobel Peace Prize for its efforts to combat hunger worldwide.