Oskar Morgenstern

CentER Discussion Paper No. 2004-42

Posted: 24 Jun 2004

See all articles by Eric van Damme

Eric van Damme

TILEC and CentER, Tilburg University

Date Written: 2004

Abstract

Together with John von Neumann, Oskar Morgenstern wrote The Theory of Games and Economic Behavior, one of the great social science books of the 20th century. The book argues strongly that traditional models and methods are unsuited to develop a general theory of rational behavior, and it proposes an alternative based on game theory. Besides expounding the theory of zero-sum two person games that had earlier been developed by von Neumann, the book contains at least three seminal contributions (the theory of expected utility, the concept of a cooperative game, and the stable set solution concept), and it provides the first applications of game theory to economics and political science. Morgenstern also worked and wrote on economic growth, on predictability of stock prices, on the accuracy of economic observations, and on methodological issues. In this entry, we describe Morgenstern's work and influence, focusing on his work in game theory. For a selection of Morgenstern's writings and a bibliography, I refer to Schotter (1976). For an overview of game theory and for definitions of the technical terms used in this article, the reader is suggested to consult Aumann (1987) or Aumann and Hart (1992-2002).

Keywords: Game theory, cooperative games, Nash equilibrium, noncooperative games, utility theory

JEL Classification: B21, B31, C70

Suggested Citation

van Damme, Eric E.C., Oskar Morgenstern (2004). CentER Discussion Paper No. 2004-42, Available at SSRN: https://ssrn.com/abstract=557845

Eric E.C. Van Damme (Contact Author)

TILEC and CentER, Tilburg University ( email )

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Tilburg, 5000 LE
Netherlands
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