Daron Acemoglu, Simon Johnson and James A Robinson have been awarded the Nobel memorial prize in economics, for their research into what causes different levels of global prosperity.

Professor Acemoglu, a Turkish American, Professor Johnson, a British American, and Professor Robinson, an Englishman, are known for their work analysing the importance of stable, inclusive institutions when it comes to a nation's economic performance.

Their work examines both how political institutions are formed and why more inclusive institutions, less extraction of resources by elites and a commitment to the rule of law create long-term economic benefits.

The announcement was made by the Royal Swedish Academy of Sciences in Stockholm on Monday, just before noon local time.

"Reducing the vast differences in income between countries is one of our time's greatest challenges," said Jakob Svensson, chair of the academy's Committee for the Prize in Economic Sciences.

"The laureates have demonstrated the importance of societal institutions for achieving this."

"Societies with a poor rule of law and institutions that exploit the population do not generate growth or change for the better," the academy added on its website.

Speaking via phone at the announcement press conference, Professor Acemoglu, who teaches at the Massachusetts Institute of Technology (MIT), said he was feeling "surprise and shock" at being named a Nobel laureate.

However, he said mostly he was happy he was in Athens when the announcement was made so he didn't have to take a phone call at 5am.

Professor Acemoglu said that, broadly speaking, the work the trio had produced had indeed shown that democracy tended to lead to economic growth.

However, he cautioned that this was more a testament to the stability of long-term democracies than it was an endorsement of a particular political or electoral system.

He added that "authoritarian" economic growth, while possible and occasionally very rapid, was often more unstable and did not lead to sustainable or original innovation.

"I think this is a time when democracies are going through a rough patch," Professor Acemoglu said.

"And it is in some sense quite crucial that they reclaim the high ground of better governance, cleaner governance, and delivering sort of the promise of democracy to a broad range of people."

The prize will be formally presented on December 10 and comes with a cash reward of 11 million Swedish kronor ($1.57 million), the same amount awarded to the other Nobel winners, to be split between the three economists.

The economics award is not one of the original categories laid out by Swedish businessman and chemist Alfred Nobel when he bequeathed his fortune to establish the prize in 1895, meaning it is not technically a Nobel Prize.

It was created instead in 1968 by Sweden's central bank and is formally known as the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.

However, the winner is selected by the same organisation as the prizes in physics and chemistry, and it is presented at the same ceremony as the other prizes, meaning it is often referred to as the Nobel Prize in economics and remains the most prestigious award that can be received in the field.

Of the 93 people to have been awarded the prize since its creation in 1968, only three have been women, including last year's winner, Harvard professor Claudia Goldin, who was honoured for her research into the gender pay gap.