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Thomas C. Schelling
Table of Contents
Thomas C. Schelling

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 * Introduction

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 * Esther Duflo
   French American economist
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   American mathematician
 * Lloyd Shapley
   American mathematician
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   American economist
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History & Society


THOMAS C. SCHELLING

American economist and game theorist
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Also known as: Thomas Crombie Schelling
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Last Updated: Article History
Table of Contents
Category: History & Society
Born: April 14, 1921 Oakland California ...(Show more) Died: December 13, 2016
(aged 95) Bethesda Maryland ...(Show more) Awards And Honors: Nobel Prize (2005)
...(Show more) Notable Works: “The Strategy of Conflict” ...(Show more) Subjects
Of Study: game theory strategy ...(Show more)
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Thomas C. Schelling, in full Thomas Crombie Schelling, (born April 14, 1921,
Oakland, California, U.S.—died December 13, 2016, Bethesda, Maryland), American
economist who shared the 2005 Nobel Prize in Economic Sciences with Robert J.
Aumann. Schelling specialized in the application of game theory to cases in
which adversaries must repeatedly interact, especially in international trade,
treaties, and conflicts. The cowinners were cited “for having enhanced our
understanding of conflict and cooperation through game-theory analysis.”

Having studied economics at the University of California, Berkeley (A.B., 1944),
and Harvard University (Ph.D., 1951), Schelling began his career working for
federal agencies and programs such as the U.S. Bureau of the Budget (1945–46),
the Marshall Plan in Europe (1948–50), and the Executive Office of the President
(1951–53). He took his first academic appointment in economics at Yale
University (1953–58) before moving to Harvard University (1958–90) and
thereafter to the University of Maryland.

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Schelling was also a senior staff member of the RAND Corporation (1958–59),
where his analysis of the nuclear arms race between the United States and the
Soviet Union led to his publication of The Strategy of Conflict (1960). His book
promoted game theory as “the” mathematical technique for the social sciences.
Among his insights were the efficacy of voluntarily limiting one’s options in
order to make the remaining ones more credible, that uncertain retaliation can
be a greater deterrent than certain retaliation, and that the ability to
retaliate is more of a deterrent than the ability to resist an attack—i.e., a
country’s best defense against nuclear war is the protection of its weapons
rather than its people.



Schelling’s idea of limited or graduated reprisals—which he later set out in
Arms and Influence (1966)—was adopted by the United States in 1965 as Operation
Rolling Thunder, which involved the bombing of selected targets in North Vietnam
in the expectation that it would deter the North Vietnamese from continuing the
war. When this failed to deter North Vietnam, the bombing campaign was
escalated, in spite of Schelling’s advice that the bombing should be abandoned
if it did not succeed in the first three weeks.

While at Harvard, Schelling applied game theory to international trade
negotiations, which led to two highly influential books: Micromotives and
Macrobehavior (1978) and Choice and Consequence (1984). The former work
explained the tendency of urban neighbourhoods toward absolute segregation.

Schelling was elected president of the American Economic Association in 1991,
and, in his presidential address “Some Economics of Global Warming” (1992), he
advanced an argument in favour of a carbon tax. He returned to the subject in
2002 with a controversial article in Foreign Affairs in which he argued that
Pres. George W. Bush’s rejection of the Kyoto Protocol was justified on the
grounds that the link between greenhouse gases and global warming was unproven
and that such a multinational accord would be unenforceable. He was one of eight
experts who drafted the United Nations’ Consensus of Copenhagen (2003), which
suggested global priorities for the next millennium—reduction of greenhouse
gases (17) falling far below treating and eradicating AIDS (1), fighting global
malnutrition (2), and eliminating customs barriers (3).

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Schelling’s analyses generally relied on clear logical argument rather than
esoteric mathematics, which made his major works highly accessible and
contributed to his strong influence both inside and outside economic circles.
His book Strategies of Commitment and Other Essays was published in 2006.

This article was most recently revised and updated by Amy Tikkanen.


Robert J. Aumann
Table of Contents
Robert J. Aumann

Table of Contents
 * Introduction

Fast Facts
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 * Images

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 * More Articles On This Topic
 * Contributors
 * Article History

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 * David Card
   Canadian-American economist
 * Amartya Sen
   Indian economist
 * Abhijit Banerjee
   Indian-born American economist
 * John Nash
   American mathematician
 * See All

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ROBERT J. AUMANN

Israeli mathematician
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Last Updated: Jun 4, 2023 • Article History
Table of Contents
Aumann, Robert J.
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Category: History & Society
Born: June 8, 1930 (age 93) Frankfurt am Main Germany ...(Show more) Awards And
Honors: Nobel Prize (2005) ...(Show more) Subjects Of Study: game theory
...(Show more)
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Robert J. Aumann, (born June 8, 1930, Frankfurt am Main, Ger.), Israeli
mathematician, who shared the 2005 Nobel Prize for Economics with Thomas C.
Schelling. Aumann’s primary contribution to economics involved the analysis of
repeated noncooperative encounters, a subject in the mathematical discipline of
game theory. The cowinners were cited “for having enhanced our understanding of
conflict and cooperation through game-theory analysis.”

Aumann emigrated to the United States with his family in 1938. He was educated
at the City College of New York (B.S., 1950) and the Massachusetts Institute of
Technology (S.M., 1952; Ph.D., 1955), followed by postdoctoral work at Princeton
University. In 1956 he moved to Israel, where he was a member of the mathematics
faculty at the Hebrew University of Jerusalem until his retirement in 2000.
Aumann also served on the editorial and advisory boards of several academic
journals, notably International Journal of Game Theory, Journal of Mathematical
Economics, and Games and Economic Behaviour.

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Aumann employed a mathematical approach to show that long-term social
interaction could be analyzed using formal noncooperative game theory. Through
his methodologies and analyses of so-called infinitely repeated games, he
identified the outcomes that could be sustained in long-term relations and
demonstrated the prerequisites for cooperation in situations where there are
many participants, infrequent interaction, or the potential for a break in
relations and when participants’ actions lack transparency.




Aumann also extended game theory with his investigation into its cognitive
foundations. He showed that peaceful cooperation is often an equilibrium
solution in a repeated game even when the parties have strong short-term
conflicting interests. Thus, cooperation is not necessarily dependent on
goodwill or an outside arbiter. Aumann named this observation the “folk
theorem.”

This article was most recently revised and updated by Amy Tikkanen.


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