US academics Robert Hall and Michael Woodford won the 2026 Nobel economics prize for their work on the “microeconomic foundations of macroeconomic stabilisation”, the Royal Swedish Academy of Sciences announced on Monday.

The award, formally known as the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, is the final Nobel prize to be announced this year and carries 12 million Swedish kronor (about $1.2 million).

The laureates developed new macroeconomic models that improved the ability to implement effective stabilisation policies, allowing governments and central banks to time fiscal and monetary measures to reduce the severity of damaging economic fluctuations.

“The laureates’ work has provided us with a stable theoretical foundation for the models that are now used by central banks and governments around the world,” John Hassler, chair of the Committee for the Prize in Economic Sciences, said in a statement.

“With them, we are better equipped to deal with shocks in the economy, such as energy crises or sudden changes in how much households consume,” he said.

First awarded in 1969, the economics prize is not one of the original five Nobel prizes established under the 1895 will of Alfred Nobel, the industrialist and inventor of dynamite. It was instituted by Sweden’s central bank.

Most previous laureates have been from the United States. Only three women have won the prize, most recently Claudia Goldin in 2023 for her research into how gender has shaped pay and employment in the United States over time.

An analysis by the Institute for Scientific Information, part of Clarivate, had identified researchers working on monetary policy, the economics of information technology and evolutionary economic theory as possible winners.

Last year’s prize went to Joel Mokyr, Philippe Aghion and Peter Howitt for their work on “creative destruction” and how new technologies and production methods can drive economic growth and improve living standards.

The Nobel prizes in medicine, physics, chemistry, literature and peace were announced last week.