According to its official website, the Royal Swedish Academy of Sciences "administers a researcher exchange with academies in other countries and publishes six scientific journals. Every year the Academy awards the Nobel Prizes in Physics and in Chemistry, the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, the Crafoord Prize and a number of other large prizes".

Each September the Academy's Economics Prize Committee, which consists of five elected members, "sends invitations to thousands of scientists, members of academies and university professors in numerous countries, asking them to nominate candidates for the Prize in Economics for the coming year. Members of the Academy and former laureates are also authorised to nominate candidates." All proposals and their supporting evidence must be received before February 1. The proposals are reviewed by the Prize Committee and specially appointed experts. Before the end of September, the committee chooses potential laureates. If there is a tie, the chairman of the committee casts the deciding vote.

Members of the Royal Swedish Academy of Sciences vote in mid-October to determine the next laureate or laureates of the Prize in Economics. As with the Nobel Prizes, no more than three people can share the prize for a given year; they must still be living at the time of the Prize announcement in October; and information about Prize nominations cannot be disclosed publicly for 50 years.

Like the Nobel laureates in physics, chemistry, physiology or medicine, and literature, each laureate in Economics receives a diploma, gold medal, and monetary grant award document from the King of Sweden at the annual Nobel Prize Award Ceremony in Stockholm, on the anniversary of Nobel's death (December 10).

The first prize in economics was awarded in 1969 to Ragnar Frisch and Jan Tinbergen "for having developed and applied dynamic models for the analysis of economic processes". Three women have received the prize: Elinor Ostrom, who won in 2009, Esther Duflo, who won in 2019, and Claudia Goldin, who won in 2023. Goldin was the first woman to win the award solo.
In February 1995, following acrimony within the selection committee pertaining to the awarding of the 1994 Prize in Economics to John Forbes Nash, the Prize in Economics was redefined as a prize in social sciences. This made it available to researchers in such topics as political science, psychology, and sociology.

Moreover, the composition of the Economics Prize Committee changed to include two non-economists. This has not been confirmed by the Economics Prize Committee. The members of the 2007 Economics Prize Committee are still dominated by economists, as the secretary and four of the five members are professors of economics.

In 1978, Herbert A. Simon, whose PhD was in political science, became the first non-economist to win the prize, for his work in the fields of economics and organizational decision making. Elinor Ostrom, also a political scientist, won the prize in 2009. Similarly, Daniel Kahneman, a professor of psychology and public affairs at Princeton University, won the prize for work in the field of behavioral economics.

Some critics argue that the prestige of the Prize in Economic Sciences derives in part from its association with the Nobel Prizes, an association that has often been a source of controversy. Among them is the Swedish human rights lawyer Peter Nobel, a great-grandnephew of Alfred Nobel.

Nobel accuses the awarding institution of misusing his family's name, and states that no member of the Nobel family has ever had the intention of establishing a prize in economics. He explained that "Nobel despised people who cared more about profits than society's well-being", saying that "There is nothing to indicate that he would have wanted such a prize", and that the association with the Nobel prizes is "a PR coup by economists to improve their reputation".
Critics cite the apparent snub of Joan Robinson as evidence of the committee's bias towards mainstream economics, though heterodox economists like Friedrich Hayek (Austrian School) and Ronald Coase (associated with new institutional economics) have won.
In his speech at the 1974 Nobel Prize banquet, Friedrich Hayek stated that had he been consulted on the establishment of a Nobel Prize in economics, he would have "decidedly advised against it", primarily because "The Nobel Prize confers on an individual an authority which in economics no man ought to possess. This does not matter in the natural sciences. Here the influence exercised by an individual is chiefly an influence on his fellow experts; and they will soon cut him down to size if he exceeds his competence. But the influence of the economist that mainly matters is an influence over laymen: politicians, journalists, civil servants and the public generally." Nevertheless, Hayek accepted the award.
• Friedrich Hayek - according to Samuel Brittan of the Financial Times, both the former Swedish minister for finance, Kjell-Olof Feldt, and the former Swedish minister for commerce, Gunnar Myrdal, wanted the prize abolished, with "Myrdal rather less graciously want[ing] the prize abolished because it had been given to such reactionaries as Hayek (and afterwards Milton Friedman)." Relatedly, it has been noted that several members of the awarding committee have been affiliated with the Mont Pelerin Society.
• Milton Friedman - was awarded the 1976 prize in part for his work on monetarism. Awarding the prize to Friedman caused international protests. Friedman was accused of supporting the military dictatorship in Chile because of the relation of economists of the University of Chicago to Pinochet, and a controversial six-day trip he took to Chile during March 1975 (less than two years after the coup that ended with the suicide of its democratically elected President Salvador Allende). Friedman himself answered that he never was an adviser to the dictatorship, but only gave some lectures and seminars on inflation and met with officials, including Augusto Pinochet, in Chile. Four Nobel Prize laureates – George Wald, Linus Pauling, David Baltimore and Salvador Luria – wrote letters in October 1976 to The New York Times protesting Friedman's award.
• Robert Aumann - 2005 prize to Robert Aumann was criticized by the European press for his alleged use of game theory to justify his stance against the dismantling of illegal Israeli settlements in occupied Palestine.
• Paul Krugman - Paul Krugman's commentary has attracted both widespread praise and criticism.

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