Leonid Hurwicz, Eric Maskin, and Roger Myerson won the Nobel Prize in economics for theories that analyze imperfections in the marketplace and help set rules for transactions ranging from government-bond auctions to elections. The three Americans will share the $1.56 million prize for “having laid the foundations of mechanism-design theory,” the Royal Swedish Academy of Sciences said yesterday in Stockholm.

Their work, based on ideas first proposed by Mr. Hurwicz, 90, helps explain what happens in markets when competition isn’t completely free and not everyone has the same information or goals. Mechanism-design theory has been used in labor negotiations, taxation, and pricing stock options, in addition to designing auctions.

“They made a fundamental advance by drilling down into the details of people’s incentives,” a former chief economist for the International Monetary Fund who’s now a University of Chicago professor, Raghuram Rajan, said. “It has applications throughout the economy and policy making.”

One application might help explain recent turbulence in financial markets, the Richmond Federal Reserve Bank president, Jeffrey Lacker, said.

Mr. Lacker, who wrote papers on mechanistic design as an academic before joining the Fed in 1989, said the theory suggests that a lack of information was a more important constraint on credit markets than was a shortage of liquidity.

He said that’s why banks didn’t borrow heavily from the Fed, even after it reduced the rate it charges them by a half percentage point on August 17. At the same time, banks remained reluctant to lend to each other because they were unsure how exposed other financial institutions were to potential losses on subprime loans.

The academy said yesterday that Messrs. Maskin and Myerson helped improve and develop Mr. Hurwicz’s ideas.

“I feel very happy that people appear to recognize it’s an important line of thinking in modern economics,” Mr. Hurwicz said in an interview from Minneapolis. “Some of the brightest young minds in economics have begun to follow it, which is nice. It’s important for economic policy for trying to unify different approaches rather than leaving people to fight it out.”

Mr. Maskin, 56, whose house in Princeton, N.J., was once the residence of Albert Einstein, called mechanism design “the reverse engineering part of economics.” “There are some things we want that are never going to be attainable by markets,” he said in a telephone interview. “If we are going to get them at all, we have to find alternative ways of delivering them. That’s where mechanism design comes in.”

Mr. Maskin, a New York City native, is a professor at the Institute for Advanced Study in Princeton. Boston-born Mr. Myerson is a professor at the University of Chicago. The prize, officially known as the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, has been given out since 1969 by Sweden’s central bank. Past winners include Milton Friedman, Amartya Sen, and Friedrich August von Hayek. Columbia University’s Edmund Phelps won last year for his theories on inflation expectations and unemployment.