Hurwicz, 90, is credited with laying the groundwork for the theory in a paper he authored in 1960. Since that time, Hurwicz, Maskin and Myerson have made many advances to the theory, extending its application to negotiations over labor issues and the auctioning of government bonds.
In an interview with the Associated Press, Hurwicz said he was surprised to have won the award.
"There were times when other people said I was on the short list, but as time passed and nothing happened, I didn't expect the recognition would come because people who were familiar with my work were slowly dying off," he said.
One person very familiar with Hurwicz's work is Leigh Tesfatsion, a professor of economics and mathematics at Iowa State University. During the early 1970s, Hurwicz was an adviser to Tesfatsion while she was enrolled in the economics department at the University of Minnesota.
"I found him, and he is still, brilliant, exacting, funny and very generous with his time," she said.
Tesfatsion said what she remembers best from those meetings is Hurwicz offering a constant reminder to "give me a concrete example."
"I have actually taken that advice much to heart," she said. "I, every once in a while, recall the exact day he said that with my own students.
"I say, 'Give me a concrete example.'"