Schelling in 2007
Thomas Crombie Schelling
April 14, 1921
|Died||December 13, 2016 95) (aged|
|Institution|| Yale University |
University of Maryland
New England Complex Systems Institute
|Alma mater|| University of California, Berkeley |
| Arthur Smithies |
| A. Michael Spence |
|Influences||Carl von Clausewitz, Niccolò Machiavelli|
|Contributions|| Focal point |
|Awards||The Frank E. Seidman Distinguished Award in Political Economy (1977) Nobel Memorial Prize in Economic Sciences (2005)|
|Information at IDEAS / RePEc|
Thomas Crombie Schelling (April 14, 1921 – December 13, 2016) was an American economist and professor of foreign policy, national security, nuclear strategy, and arms control at the School of Public Policy at University of Maryland, College Park. He was also co-faculty at the New England Complex Systems Institute. He was awarded the 2005 Nobel Memorial Prize in Economic Sciences (shared with Robert Aumann) for "having enhanced our understanding of conflict and cooperation through game-theory analysis."
An economist is a practitioner in the social science discipline of economics.
A country's foreign policy, also called foreign relations or foreign affairs policy, consists of self-interest strategies chosen by the state to safeguard its national interests and to achieve goals within its international relations milieu. The approaches are strategically employed to interact with other countries. The study of such strategies is called foreign policy analysis. In recent times, due to the deepening level of globalization and transnational activities, the states will also have to interact with non-state actors. The aforementioned interaction is evaluated and monitored in attempts to maximize the benefits of multilateral international cooperation. Since the national interests are paramount, foreign policies are designed by the government through high-level decision-making processes. National interests accomplishment can occur as a result of peaceful cooperation with other nations, or through exploitation. Usually, creating foreign policy is the job of the head of government and the foreign minister. In some countries, the legislature also has considerable effects. Foreign policies of countries have varying rates of change and scopes of intent, which can be affected by factors that change the perceived national interests or even affect the stability of the country itself. The foreign policy of a country can have a profound and lasting impact on many other countries and on the course of international relations as a whole, such as the Monroe Doctrine conflicting with the mercantilism policies of 19th-century European countries and the goals of independence of newly formed Central American and South American countries.
National security is the security of a nation state, including its citizens, economy, and institutions, which is regarded as a duty of government.
Schelling was born on April 14, 1921 in Oakland, California.Schelling graduated from San Diego High. He received his bachelor's degree in economics from the University of California, Berkeley in 1944. He received his PhD in economics from Harvard University in 1951.
Oakland is the largest city and the county seat of Alameda County, California, United States. A major West Coast port city, Oakland is the largest city in the East Bay region of the San Francisco Bay Area, the third largest city overall in the San Francisco Bay Area, the eighth most populated city in California, and the 45th largest city in the United States. With a population of 432,897 as of 2019, it serves as a trade center for the San Francisco Bay Area; its Port of Oakland is the busiest port in the San Francisco Bay, the entirety of Northern California, and the fifth busiest in the United States of America. An act to incorporate the city was passed on May 4, 1852, and incorporation was later approved on March 25, 1854, which officially made Oakland a city. Oakland is a charter city.
A bachelor's degree or baccalaureate is an undergraduate academic degree awarded by colleges and universities upon completion of a course of study lasting three to seven years. In some institutions and educational systems, some bachelor's degrees can only be taken as graduate or postgraduate degrees after a first degree has been completed. In countries with qualifications frameworks, bachelor's degrees are normally one of the major levels in the framework, although some qualifications titled bachelor's degrees may be at other levels and some qualifications with non-bachelor's titles may be classified as bachelor's degrees.
The University of California, Berkeley is a public research university in Berkeley, California. It was founded in 1868 and serves as the flagship institution of the ten research universities affiliated with the University of California system. Berkeley has since grown to instruct over 40,000 students in approximately 350 undergraduate and graduate degree programs covering numerous disciplines.
Schelling served with the Marshall Plan in Europe, the White House, and the Executive Office of the President from 1948 to 1953.He wrote most of his dissertation on national income behavior working at night while in Europe. He left government to join the economics faculty at Yale University.
The Marshall Plan was an American initiative passed in 1948 to aid Western Europe, in which the United States gave over $12 billion in economic assistance to help rebuild Western European economies after the end of World War II. Replacing the previous Morgenthau Plan, it operated for four years beginning on April 3, 1948. The goals of the United States were to rebuild war-torn regions, remove trade barriers, modernize industry, improve European prosperity, and prevent the spread of Communism. The Marshall Plan required a reduction of interstate barriers, a dropping of many regulations, and encouraged an increase in productivity, as well as the adoption of modern business procedures.
Europe is a continent located entirely in the Northern Hemisphere and mostly in the Eastern Hemisphere. It is bordered by the Arctic Ocean to the north, the Atlantic Ocean to the west, Asia to the east, and the Mediterranean Sea to the south. It comprises the westernmost part of Eurasia.
The White House is the official residence and workplace of the president of the United States. It is located at 1600 Pennsylvania Avenue NW in Washington, D.C. and has been the residence of every U.S. president since John Adams in 1800. The term "White House" is often used as a metonym for the president and his advisers.
In 1956, "...he joined the RAND Corporation as an adjunct fellow, becoming a full-time researcher for a year after leaving Yale, and returning to adjunct status through 2002."In 1958 Schelling was appointed professor of economics at Harvard. That same year, he "co-founded the Center for International Affairs, which was [later] renamed the Weatherhead Center for International Affairs."
The Weatherhead Center for International Affairs is a research center for international affairs and the largest international research center within Harvard University’s Faculty of Arts and Sciences. It is headed by Michèle Lamont.
In 1969 Schelling joined Harvard's John F. Kennedy School of Government, where he was the Lucius N. Littauer Professor of Political Economy.He was among the "founding fathers" of the "modern" Kennedy School, as he helped to shift the curriculum's emphasis away from administration and more toward leadership.
The John F. Kennedy School of Government at Harvard University is a public policy and public administration school, of Harvard University in Cambridge, Massachusetts, United States. The school offers master's degrees in public policy, public administration, and international development, grants several doctoral degrees, and many executive education programs. It conducts research in subjects relating to politics, government, international affairs, and economics. Since 1970 the school has graduated 17 heads of state, the most of any educational institution.
He conducted research at the International Institute for Applied Systems Analysis (IIASA), in Laxenburg, Austria, between 1994 and 1999.
The International Institute for Applied Systems Analysis (IIASA) is an international research organization located in Laxenburg, near Vienna, in Austria. IIASA conducts interdisciplinary scientific studies on environmental, economic, technological and social issues in the context of human dimensions of global change. IIASA’s mission is "to provide insights and guidance to policymakers worldwide by finding solutions to global and universal problems through applied systems analysis in order to improve human and social wellbeing and to protect the environment."
Laxenburg is a market town in the district of Mödling, in the Austrian state of Lower Austria. Located about 20 km (12 mi) south of the Austrian capital Vienna, it is chiefly known for the Laxenburg castles, which, beside Schönbrunn, served as the most important summer retreat of the Habsburg monarchs.
Austria, formal name: the Republic of Austria, is a country in Central Europe comprising nine federated states. Its capital, largest city and one of nine states is Vienna. Austria has an area of 83,879 km2 (32,386 sq mi), a population of nearly nine million people and a nominal GDP of $477 billion. It is bordered by the Czech Republic and Germany to the north, Hungary and Slovakia to the east, Slovenia and Italy to the south, and Switzerland and Liechtenstein to the west. The terrain is landlocked and highly mountainous, lying within the Alps; only 32% of the country is below 500 m (1,640 ft), and its highest point is 3,798 m (12,461 ft). The majority of the population speaks local Bavarian dialects as their native language, and German in its standard form is the country's official language. Other regional languages are Hungarian, Burgenland Croatian, and Slovene.
In 1990 he left Harvard and joined the University of Maryland School of Public Policy and University of Maryland Department of Economics.In 1991, he accepted the presidency of the American Economic Association, an organization of which he was also a Distinguished Fellow.
In 1995, he accepted the presidency of the Eastern Economic Association.
Schelling was a contributing participant of the Copenhagen Consensus.
In 1977, Schelling received The Frank E. Seidman Distinguished Award in Political Economy.
In 1993 he was awarded the Award for Behavior Research Relevant to the Prevention of Nuclear War from the National Academy of Sciences.
He received honorary doctorates from Erasmus University Rotterdam in 2003, Yale University in 2009, and RAND Graduate School of Public Analysis, as well as an honorary degree from the University of Manchester in 2010.
He was awarded the 2005 Nobel Memorial Prize in Economic Sciences, along with Robert Aumann, for "having enhanced our understanding of conflict and cooperation through game-theory analysis."
Schelling was married to Corinne Tigay Saposs from 1947 to 1991, with whom he had four sons. Later in 1991 he married Alice M. Coleman, who brought two sons to the marriage; they became his stepsons.
Schelling died on December 13, 2016 in Bethesda, Maryland from complications following a hip fracture at the age of 95.
Schelling's family auctioned his Nobel award medal, fetching $187,000. They donated this money to the Southern Poverty Law Center, a nonprofit that fights hate and bigotry, and advocates for civil rights through litigation. Alice Schelling said her late husband had credited Smoky the Cowhorse by Will James, the winner of the Newbery Medal in 1927, as the most influential book he had read.
The Strategy of Conflict, which Schelling published in 1960,pioneered the study of bargaining and strategic behavior in what he refers to as "conflict behavior." The Times Literary Supplement in 1995 ranked it as one of the hundred most influential books in the 50 years since 1945. In this book Schelling introduced concepts such as the "focal point" and "credible commitment."
The strategic view toward conflict that Schelling encourages in this work is equally "rational" and "successful."He believes that it cannot be based merely on one's intelligence, but must also address the "advantages" associated with a course of action. The advantages gleaned, he says, should be firmly fixed in a value system that is both "explicit" and "consistent."
Conflict too has a distinct meaning. In Schelling's approach, it is not enough to defeat your opponent. Instead, one must seize opportunities to cooperate. And in most cases, there are many. Only on the rarest of occasions, in what is known as "pure conflict," he points out, will the interests of participants be implacably opposed.He uses the example of "a war of complete extermination" to illustrate this phenomenon.
Cooperation, where available, may take many forms, and thus could potentially involve everything from "deterrence, limited war, and disarmament" to "negotiation."Indeed, it is through such actions that participants are left with less of a conflict and more of a "bargaining situation." The bargaining itself is best thought of in terms of the other participant's actions, as any gains one might realize are highly dependent upon the "choices or decisions" of their opponent.
Communication between parties, though, is another matter entirely. Verbal or written communication is known as "explicit," and involves such activities as "offering concessions."What happens, though, when this type of communication becomes impossible or improbable? This is when something called "tacit maneuvers" become important. Think of this as action-based communication. Schelling uses the example of one's occupation or evacuation of strategic territory to illustrate this latter communication method.
In an article celebrating Schelling's Nobel Memorial Prize for Economics,Michael Kinsley, Washington Post op‑ed columnist and one of Schelling's former students, anecdotally summarizes Schelling's reorientation of game theory thus: "[Y]ou're standing at the edge of a cliff, chained by the ankle to someone else. You'll be released, and one of you will get a large prize, as soon as the other gives in. How do you persuade the other guy to give in, when the only method at your disposal—threatening to push him off the cliff—would doom you both? Answer: You start dancing, closer and closer to the edge. That way, you don't have to convince him that you would do something totally irrational: plunge him and yourself off the cliff. You just have to convince him that you are prepared to take a higher risk than he is of accidentally falling off the cliff. If you can do that, you win."
Schelling's theories about war were extended in Arms and Influence, published in 1966.The blurb states that it "carries forward the analysis so brilliantly begun in his earlier The Strategy of Conflict (1960) and Strategy and Arms Control (with Morton Halperin, 1961), and makes a significant contribution to the growing literature on modern war and diplomacy." Chapter headings include The Diplomacy of Violence, The Diplomacy of Ultimate Survival and The Dynamics of Mutual Alarm.
In 1969 and 1971, Schelling published widely cited articles dealing with racial dynamics and what he termed "a general theory of tipping."In these papers he showed that a preference that one's neighbors be of the same color, or even a preference for a mixture "up to some limit," could lead to total segregation, thus arguing that motives, malicious or not, were indistinguishable as to explaining the phenomenon of complete local separation of distinct groups. He used coins on graph paper to demonstrate his theory by placing pennies and dimes in different patterns on the "board" and then moving them one by one if they were in an "unhappy" situation.
Schelling's dynamics has been cited as a way of explaining variations that are found in what are regarded as meaningful differences –gender, age, race, ethnicity, language, sexual preference, and religion. Once a cycle of such change has begun, it may have a self-sustaining momentum. His 1978 book Micromotives and Macrobehavior expanded on and generalized these themes and is often cited in the literature of agent-based computational economics.
Schelling was involved in the global warming debate since chairing a commission for President Jimmy Carter in 1980. He believed climate change poses a serious threat to developing nations, but that the threat to the United States was exaggerated. He wrote that,
Today, little of our gross domestic product is produced outdoors, and therefore, little is susceptible to climate. Agriculture and forestry are less than 3 percent of total output, and little else is much affected. Even if agricultural productivity declined by a third over the next half-century, the per capita GNP we might have achieved by 2050 we would still achieve in 2051. Considering that agricultural productivity in most parts of the world continues to improve (and that many crops may benefit directly from enhanced photosynthesis due to increased carbon dioxide), it is not at all certain that the net impact on agriculture will be negative or much noticed in the developed world.
Drawing on his experience with the Marshall Plan after World War II, he argued that addressing global warming is a bargaining problem: if the world were able to reduce emissions, poor countries would receive most of the benefits, but rich countries would bear most of the costs.
Stanley Kubrick read an article Schelling wrote that included a description of the Peter George novel Red Alert , and conversations between Kubrick, Schelling, and George eventually led to the 1964 movie Dr. Strangelove or: How I Learned to Stop Worrying and Love the Bomb .
Schelling is also cited for the first known use of the phrase collateral damage in his May 1961 article Dispersal, Deterrence, and Damage.
Game theory is the study of mathematical models of strategic interaction between rational decision-makers. It has applications in all fields of social science, as well as in logic and computer science. Originally, it addressed zero-sum games, in which each participant's gains or losses are exactly balanced by those of the other participants. Today, game theory applies to a wide range of behavioral relations, and is now an umbrella term for the science of logical decision making in humans, animals, and computers.
Reinhard Justus Reginald Selten was a German economist, who won the 1994 Nobel Memorial Prize in Economic Sciences. He is also well known for his work in bounded rationality and can be considered as one of the founding fathers of experimental economics.
In sociology, a tipping point is a point in time when a group—or a large number of group members—rapidly and dramatically changes its behavior by widely adopting a previously rare practice.
John Charles Harsanyi was a Hungarian-American economist.
The New England Complex Systems Institute (NECSI) is a small American research institution dedicated to advancing the study of complex systems. NECSI offers educational programs, conducts research, and hosts the International Conference on Complex Systems. It was founded in 1996 and is located in Cambridge, Massachusetts.
In game theory, coordination games are a class of games with multiple pure strategy Nash equilibria in which players choose the same or corresponding strategies.
Lloyd Stowell Shapley was an American mathematician and Nobel Prize-winning economist. He contributed to the fields of mathematical economics and especially game theory. Shapley is generally considered one of the most important contributors to the development of game theory since the work of von Neumann and Morgenstern. With Alvin E. Roth, Shapley won the 2012 Nobel Memorial Prize in Economic Sciences "for the theory of stable allocations and the practice of market design."
Omicron Delta Epsilon is an international honor society in the field of economics, formed from the merger of Omicron Delta Gamma and Omicron Chi Epsilon, in 1963. Its board of trustees includes well-known economists such as Robert Lucas, Richard Thaler, and Robert Solow. ODE is a member of the Association of College Honor Societies; the ACHS indicates that ODE inducts approximately 4,000 collegiate members each year and has more than 100,000 living lifetime members. There are approximately 700 active ODE chapters worldwide. New members consist of undergraduate and graduate students, as well as college and university faculty; the academic achievement required to obtain membership for students can be raised by individual chapters, as well as the ability to run for office or wear honors cords during graduation. It publishes an academic journal entitled The American Economist twice each year.
In game theory, a focal point is a solution that people will tend to use in the absence of communication, because it seems natural, special, or relevant to them. The concept was introduced by the Nobel Memorial Prize-winning American economist Thomas Schelling in his book The Strategy of Conflict (1960). In this book, Schelling describes "focal point[s] for each person's expectation of what the other expects him to expect to be expected to do". This type of focal point later was named after Schelling. He further explains that such points are highly useful in negotiations, because we cannot completely trust our negotiating partners' words.
Christopher Albert "Chris" Sims is an American econometrician and macroeconomist. He is currently the John J.F. Sherrerd ’52 University Professor of Economics at Princeton University. Together with Thomas Sargent, he won the Nobel Memorial Prize in Economic Sciences in 2011. The award cited their "empirical research on cause and effect in the macroeconomy".
In social dynamics, critical mass is a sufficient number of adopters of an innovation in a social system so that the rate of adoption becomes self-sustaining and creates further growth. The term is borrowed from nuclear physics and in that field it refers to the amount of a substance needed to sustain a chain reaction.
The Maryland School of Public Policy is one of 14 schools at the University of Maryland, College Park. The school is located inside the Capital Beltway and ranks 16th nationally for schools of public policy according to U.S. News & World Report (2012).
Precommitment refers to a strategy that an agent may use to restrict the number of choices available to him or her at a future time. The strategy may also involve the imposition of obstacles or additional costs to certain courses of action in advance. As theorized by the social scientist Jon Elster, an agent may precommit herself when she predicts that her preferences will change but wishes to ensure that her future actions will align with her current preferences. Precommitment has also been studied as a bargaining strategy in which agents bind themselves to one course of action in order to enhance the credibility of present threats. Some scholars have proposed that collective political agents may also engage in precommitment by adopting constitutions that limit the scope of future legislation. The validity of this application of precommitment theory has been called into question, however.
Eric Stark Maskin is an American economist and 2007 Nobel laureate recognized with Leonid Hurwicz and Roger Myerson "for having laid the foundations of mechanism design theory". He is the Adams University Professor at Harvard University. Until 2011, he was the Albert O. Hirschman Professor of Social Science at the Institute for Advanced Study, and a visiting lecturer with the rank of professor at Princeton University.
Roger Bruce Myerson is an American economist and professor at the University of Chicago. He holds the title of The Glen A. Lloyd Distinguished Service Professor in Economics and the College and Harris Graduate School of Public Policy Studies. In 2007, he was the winner of the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel with Leonid Hurwicz and Eric Maskin for "having laid the foundations of mechanism design theory." He was elected a Member of the American Philosophical Society in 2019.
Alvin Elliot Roth is an American academic. He is the Craig and Susan McCaw professor of economics at Stanford University and the Gund professor of economics and business administration emeritus at Harvard University. He was President of the American Economics Association in 2017.
RAND Corporation is an American nonprofit global policy think tank created in 1948 by Douglas Aircraft Company to offer research and analysis to the United States Armed Forces. It is financed by the U.S. government and private endowment, corporations, universities and private individuals. The company has grown to assist other governments, international organizations, private companies and foundations, with a host of defense and non-defense issues, including healthcare. RAND aims for interdisciplinary and quantitative problem solving by translating theoretical concepts from formal economics and the physical sciences into novel applications in other areas, using applied science and operations research.
The University of Maryland College of Behavioral and Social Sciences is one of the 13 schools and colleges at the University of Maryland, College Park. With 10 departments, it is one of the largest colleges at the university, with three in ten University of Maryland undergraduates receiving their degree from the college. 45 research centers also are located in the College. Its social science programs are collectively ranked 10th in the United States by the Faculty Scholarly Productivity Index, and 18th in the world by the Institute of Higher Education at Shanghai Jiao Tong University.
Strategic delegation refers to delegation of decision-making to agents, and accompanying organizational design choices, which, under strategic interdependence, serve as commitments that influence interactions with rivals and potentially lead to beneficial outcomes for the delegating party.
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| Laureate of the Nobel Memorial Prize in Economics |
Served alongside: Robert Aumann