Theory of Games and Economic Behavior.

VON NEUMANN, John & Oscar Morgenstern.

Item Number: 5471

Princeton, NJ: Princeton University Press, 2004.

First edition of the sixtieth anniversary edition. Octavo, original cloth. Nobel Prize winning-economist John Nash’s copy with his signature to the upper right hand corner. Near fine in a near fine dust jacket with a small closed tear to the front panel. Nash was heavily influenced by von Neumann’s Theory of Games and Economic Behavior. After first encountering game theory from the works of John von Neumann and Oskar Morgenster, Nash was the first to introduce the economic application of game theory. In 1950, his dissertation explained the “Nash Equilibrium,” developing the theory to solve strategic non-cooperative games for mutual gain. He further developed game theory with his “Nash Bargaining Solution,” which was a solution concept for two-person cooperative games. In 1951, he introduced his name to another side of economics with the “Nash Programme.” This paper called for the reduction of all cooperative games into a non-cooperative framework. John Nash’s ideas on game theory have caused its influence to grow so quickly that some claim, it is on a path “to overwhelm much of economics itself.” A nice association.

This is the classic work upon which modern-day game theory is based. What began more than sixty years ago as a modest proposal that a mathematician and an economist write a short paper together blossomed, in 1944, when Princeton University Press published Theory of Games and Economic Behavior. In it, John von Neumann and Oskar Morgenstern conceived a groundbreaking mathematical theory of economic and social organization, based on a theory of games of strategy. Not only would this revolutionize economics, but the entirely new field of scientific inquiry it yielded--game theory--has since been widely used to analyze a host of real-world phenomena from arms races to optimal policy choices of presidential candidates, from vaccination policy to major league baseball salary negotiations. And it is today established throughout both the social sciences and a wide range of other sciences. "A rich and multifaceted work. . . . [S]ixty years later, the Theory of Games may indeed be viewed as one of the landmarks of twentieth-century social science" (Robert J. Leonard, History of Political Economics).