STOCKHOLM - Americans Thomas Sargent and Christopher Sims won the Nobel economics prize on Monday "for their empirical research on cause and effect in the macroeconomy," the Royal Swedish Academy of Sciences said.

Thomas J. Sargent, professor of Economics at New York University, speaks at the American Economic Association Conference in Atlanta in this file photo taken Jan 5, 2010. [Photo/Agencies]

The prize committee said the winners have developed methods for answering questions such as how economic growth and inflation are affected by a temporary increase in the interest rate or a tax cut. Sargent and Sims - both 68 - carried out their research independently in the 1970s and '80s.

"Today, the methods developed by Sargent and Sims are essential tools in macroeconomic analysis," the citation said.

Sargent is a professor at New York University, and Sims is a professor at Princeton University.

The economics prize capped this year's Nobel announcements. The awards will be handed out on Dec 10 - the anniversary of prize founder Alfred Nobel's death. The economics prize is not among the original awards established in Nobel's 1895 will, but was created in 1968 by the Swedish central bank in his memory.

Christopher Sims, professor of Economics and Banking at Princeton University is pictured in this 2006 photograph made available on Oct 10, 2011. [Photo/Agencies]