Two Americans, British-Cypriot share economics Nobel

• Two Americans and a British-Cypriot economist won the 2010 Nobel economics prize on Monday for developing a theory that helps explain why many people can remain unemployed despite a large number of job vacancies.
• Federal Reserve board nominee Peter Diamond was honoured along with Dale Mortensen and Christopher Pissarides with the 10 million Swedish kronor ($1.5 million) prize for their analysis of the obstacles that prevent buyers and sellers from efficiently pairing up in markets.
• Mr. Diamond — a former mentor to current Federal Reserve chairman Ben Bernanke — analysed the foundations of so-called search markets, while Mr. Mortensen and Mr. Pissarides expanded the theory and applied it to the labour market.
• Since searching for jobs takes time and resources, it creates frictions in the job market, helping explain why there are both job vacancies and unemployment simultaneously, the academy said.
• "The laureates' models help us understand the ways in which unemployment, job vacancies and wages are affected by regulation and economic policy," the Nobel Prize citation said.