Theory of Games and Economic Behavior, published in 1944 by Princeton University Press, is a book by mathematician John von Neumann and economist Oskar Morgenstern which is considered the groundbreaking text that created the interdisciplinary research field of game theory. In the introduction of its 60th anniversary commemorative edition from the Princeton University Press, the book is described as "the classic work upon which modern-day game theory is based."
The book is based on prior research by von Neumann, published in 1928 under the German title "Zur Theorie der Gesellschaftsspiele" ("On the Theory of Parlor Games").
The derivation of expected utility from its axioms appeared in an appendix to the Second Edition (1947). Von Neumann and Morgenstern used objective probabilities, supposing that all the agents had the same probability distribution, as a convenience. However, von Neumann and Morgenstern mentioned that a theory of subjective probability could be provided, and this task was completed by Johann Pfanzagl in 1967.
Famous quotes containing the words games and/or economic:
“As long as lightly all their livelong sessions,
Like a yardful of schoolboys out at recess
Before their plays and games were organized,
They yelling mix tag, hide-and-seek, hopscotch,
And leapfrog in each other’s way all’s well.”
—Robert Frost (1874–1963)
“But I would emphasize again that social and economic solutions, as such, will not avail to satisfy the aspirations of the people unless they conform with the traditions of our race, deeply grooved in their sentiments through a century and a half of struggle for ideals of life that are rooted in religion and fed from purely spiritual springs.”
—Herbert Hoover (1874–1964)