The duo was honoured “for improvements to auction theory and inventions of new auction formats,” the jury said.
The Royal Swedish Academy of Sciences noted that the discoveries by Milgrom, 72, and Wilson, 83, “have benefitted sellers, buyers and taxpayers around the world,” it said in a statement.
The winners will share the prize sum of 10 million Swedish kronor (about $1.1 million).
Last year the honour went to French-American Esther Duflo, Indian-born Abhijit Banerjee of the US, and American Michael Kremer for their experimental work on alleviating poverty.
Even if it might be the most prestigious prize an economist can hope to receive, the economics prize has not reached the same status as those originally chosen by Alfred Nobel in his will, which included medicine, physics, chemistry, literature and peace.
It was instead created through a donation from the Swedish central bank and detractors have thus dubbed it “a false Nobel”.
The prize closes the 2020 Nobel season which so far has seen the peace prize awarded to the UN's World Food Programme.
Women have been more prevalent than usual this year, with American poet Louise Glück winning the literature prize.
And Frenchwoman Emmanuelle Charpentier and American Jennifer Doudna became the first all-female duo to win a scientific Nobel on Wednesday, clinching the chemistry award for their discovery of the CRISPR-Cas9 DNA snipping “scissors”.
Winners would normally receive their Nobel from King Carl XVI Gustaf at a formal ceremony in Stockholm on December 10th, but the pandemic means it has been replaced by a televised ceremony showing the laureates receiving their awards in their home countries.