John C. Harsanyi – “I Found the Conceptual and Mathematical Elegance of Economic Theory Very Attractive.”

John C. Harsanyi is a celebrated economist and co-recipient of the 1994 Nobel Prize for Economics together with John F. Nash and Reinhard Selten. He was awarded the Nobel Prize for his contribution in game theory.

A Hungarian of Jewish descent, John C. Harsanyi won the Nobel award for his work in game theory; a specialization that deals with competition where information is imperfect or incomplete and players have to no clue about the response of their opponents.

John C. Harsanyi is a celebrated economist and co-recipient of the 1994 Nobel Prize for Economics together with John F. Nash and Reinhard Selten. He was awarded the Nobel Prize for his contribution in game theory.

A Hungarian of Jewish descent, John C. Harsanyi won the Nobel award for his work in game theory; a specialization that deals with competition where information is imperfect or incomplete and players have to no clue about the response of their opponents.

Simplistically speaking, game theory does not restrict itself in the confines of the economic sphere. Game theory is a branch of mathematics that analyzes situations involving conflicting interests. This theory also examines competitions among contenders with mixed interests and uses probability calculations to predict the outcomes of games like chess, and can even be applied to labour negotiations, hostile takeovers, political and economic conflicts.

When Harsanyi joined the Haas Business School in 1964, he was tasked as one of the 10 game theorists to advise the US Arms Control and Disarmament Agency on its negotiations with the Soviet Union.

According to Harsanyi,

[quote]“We discovered that we could not advise them on this matter because these negotiations represented a game with incomplete information, in which each side knew little about the other side.”[/quote]

Among his most prominent work, Harsanyi’s contribution to economics involved developing the philosophical implications of game theory and marrying it with the concept of utility economics.

Harsanyi studied pharmacy and sociology before making the final switch to economics. In his words,

[quote]“I changed over from sociology to economics because I found the conceptual and mathematical elegance of economic theory very attractive.”[/quote]

Personal and academic timeline:

John C. Harsanyi was born on May 29, 1920 in Budapest, Hungary and died on August 9, 2000 in Berkeley, California, United States.

1947: Awarded a doctorate degree in philosophy from the University of Budapest. Lecturer of sociology in the same university.

1950: Fled Austria and migrated to Australia.

1953: Gained admission into Sydney University, M.A. in economics.

1956: Attended to Stanford University on a Rockefeller fellowship.

1959: Awarded PhD in economics from Stanford University, USA.

1964: Professor at the Haas School of Business at the University of California, Berkeley.

Publications

1953: “Cardinal Utility in Welfare Economics and in the Theory of Risk-Taking”, Journal of Political Economy

1962: “Bargaining in Ignorance of the Opponent’s Utility Function”, Journal of Conflict Resolution

1967: “Games with Incomplete Information Played by “Bayesian” Players, I-III. Part I. The Basic Model”, Management Science, Vol. 14, No. 3, Theory Series

1976: Essays on Ethics, Social Behavior, and Scientific Explanation, Dordrecht, Holland: Reidel Publishing Company

1977: Rational Behavior and Bargaining Equilibrium in Games and Social Situations, Cambridge, United Kingdom: Cambridge University Press

1982: Papers in Game Theory, Dordrecht, Holland: Reidel Publishing Company

1988: A General Theory of Equilibrium Selection in Games (with Reinhard Selten), Cambridge, MA: MIT-Press.

Books by John C. Harsanyi

•   Rational Behaviour and Bargaining Equilibrium in Games and Social Situations

•   A General Theory of Equilibrium Selection in Games

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