The Nobel Prize for economics has been awarded to U.S. economist Richard Thaler for work focusing on "understanding the psychology of economics."

The 9-million-kronor ($1.1-million) prize was awarded to the academic from the University of Chicago on October 9.

Thaler's work shows how human traits affect individual decisions as well as market outcomes, the Nobel committee said.

Thaler, 72, "is a pioneer in behavioral economics, a research field in which insights from psychological research are applied to economic decision making," a background paper from the academy said.

That "incorporates more realistic analysis of how people think and behave when making economic decisions," it said.

The economics prize, officially called the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, was established in 1968.

It was not part of the original group of awards set out in the 1895 will of Swedish dynamite inventor and philanthropist Alfred Nobel.

Based on reporting by Reuters, AP, and dpa