There is no such thing as a "Nobel Prize in Economics". What Krugman and the ones before him won was "The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel." It's the highest achievement in Economics but it isn't a Nobel Prize. You see, Alfred Nobel set up exactly five prizes: physics, chemistry, physiology or medicine, literature and for peace, and didn't leave any means to extend or shorten the list. They've been awarded since 1901.
The Riksbank Prize, on the other hand, was started in 1968. How did it begin? From the Nobel Foundation website:
On the occasion of its 300th anniversary in 1968, the Sveriges Riksbank (Sweden's central bank) made a large donation to the Nobel Foundation. A Prize in Economic Sciences in Memory of Alfred Nobel has been awarded since 1969. The Royal Swedish Academy of Sciences is entrusted with the role of Prize Awarding-Institution, in accordance with Nobel Prize rules. The Board of the Nobel Foundation has subsequently decided that it will allow no further new prizes.
The Nobel Foundation official website makes a mess of this distinction. On the one hand, the site always calls it the "Economics Prize". You won't find the phrase "Nobel Prize in Economics" anywhere. On the other hand, you see economics prize winners included in the list of Nobel Laureates.
Why do I care? Well a blog concerned with climate science reporting in the press really values accuracy and hates the kind of sloppiness that allows the media to go on reporting lies like "Al Gore said he invented the internet". Its not correct to call it the Nobel Prize in Economics. Call it what it is: the Riksbank Prize or the Economics Prize.
I'm not the only one with a beef about this either. From the Riksbank Prize wikipedia entry:
Some critics argue that the prestige of the Prize in Economics derives in part from its association with the Nobel Prizes, an association that has often been a source of controversy. Among the most vocal critics of the Prize in Economics is the Swedish human rights lawyer Peter Nobel, a great-grandnephew of Alfred Nobel. Swedish economist Gunnar Myrdal and former Swedish minister of finance Kjell-Olof Feldt have also advocated that the Prize in Economics should be abolished. Myrdal's objections were based on his view that the 1976 Prize in Economics to Milton Friedman and the 1974 Prize in Economics shared by Friedrich Hayek (both classical liberal economists) were undeserved, on the argument that Economics did not qualify as a science. If he had been asked about the establishment of the Prize before receiving it, Hayek stated that he would "have decidedly advised against it.
The bigger picture here is that economics, or at least the branch that promoted and apologized for the free-market liberalism that has led to our current mess (which does not include Krugman), has had an outsized influence on our decision makers and opinion leaders and the prestige of a "Nobel Prize in Economics" helps keep that influence alive. Calling the prize for what it can help take them down a few pegs.