Nobel Prize Winner Thomas Schelling

I’ve changed addresses 10 times since I graduated from college. And each time I’ve moved, I’ve looked at the battered old box of college notebooks and debated whether it was time to throw the box out. After all, it has been more than 15 years and the box has never once been opened.

Thomas Schelling winning the Nobel prize in economics finally gave me a reason to open the box. My sophomore year in college I took Econ 1030 from Schelling. I believe the course was entitled something like “Conflict and Strategy.” I still have vivid memories of the course. A crew-cut Schelling paced back and forth across the stage (never with any notes, if I remember correctly), spewing forth story after story that illuminated the application of simple game theory concepts in every day life. The pauses between the stories were long enough that I had the impression he was coming up with them on the spot, although my own experience as a teacher makes me think otherwise.

For me, this first introduction to game theory was inspirational. For someone who thinks strategically, or would like to think strategically, the basic tools of game theory are essential. The beauty of Schelling’s class was how easy the math was and how readily it applied to real world settings. The topics of the course were basic: the Prisoner’s Dilemma in lecture 1, Schelling’s own “tipping point” model in lectures 2&3, the tragedy of the commons and public goods games after that, then commitment devices, credible and non-credible threats, and the strategy and tactics of controlling one’s own behavior.

(For those who are unaware, Schelling coined the term “Tipping Point” thirty years before Gladwell made it popular.)

Any economist could have taught the subjects in the class, but no one would have taught it like Schelling did. Each concept was accompanied by a barrage of examples. My notes are so poorly done — I would write down only a few key words — that now I can only guess at what the story was behind the words: when Rhodesia came Zimbabwe, VHS vs. Beta, the quality of play in bridge leagues, choosing colleges, Dulles vs. National airport, Bear Bryant should not have voted for USC, good weatherman takes fair bets, tailgating, Landon vs. Roosevelt, randomly flushing the toilet, etc.

I even remember attempting to put the lessons Schelling was teaching me immediately into practice. People who know me know that I can fall asleep anywhere, anytime. I would guess that I slept through some portion of 90 percent of my college classes. So when Schelling taught us about commitment, I decided I would start sitting in the front row of class as a way of committing myself not to sleep. Unfortunately, the urge to sleep often proved all too powerful. If Schelling were to remember me, it would be as the only kid in the first row who always fell asleep.

To my mind, Schelling represents the very best of game theory. He was a pioneer in the field, a man of ideas. Unfortunately for game theory, the simple ideas that are so alluring were quickly mined. What followed was less interesting. Modern game theory has become extremely mathematical, notation heavy, and removed from everyday life. Many of my colleagues would not agree with me, but I think game theory has failed to deliver on its enormous initial promise. I’m not the only one who feels this way. I was recently speaking with a prominent game theorist. He told me that if he knew what he knew and he were just getting started in the profession today, no way would he be a game theorist.

Schelling was an early inspiration to me. His course and writings were one of the big influences pushing me towards economics. My approach to economics shares much with his approach. I was saying this to one of my colleagues last year, who happened to run into Schelling and told Schelling he should count me as one of his students. Schelling was unmoved.

(For more on Schelling, Tyler Cowen at Marginal Revolution wrote this.)


fredbb72

Not to be too picky, but there is no Nobel Prize in Economics. There is a Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel, but it is NOT a Nobel Prize. Nobel specifically declined to create an award in economics at that time. This is not to say I agree with his view on economics, but it's the title of being a "Nobel Prize" winner that creates more fuss (typically) than what the winner actually did to get the prize.

StCheryl

Obviously, Schelling had not yet read the corrected questionnaire in the chapter on crack dealers.

What is the most surprising/oddest place you have fallen asleep? (Other than in the front row of Schelling's class, that is.)

Gringo_Nordestino

Very interesting. Thanks for sharing your experience!

3612

Nice commons, less tragedy here perhaps.

Dr. Funk

Two of the courses that really blew me away in college were Logic and Game Theory. There's just so much you can do with very basic concepts. Yet is seems that academics are interested in advancing the subjects only at the very theoretical level, instead of using the basics to go around explaining things that are tough to understand.

How much literature is there about, for instance, game theory in the behavior of children at summer camp?

Davos Newbies » Blog Archive » Levitt on Schelling

[...] Fortunately, the pattern is broken today with Levitt’s recollections of his class with Nobel prizewinner Thomas Schelling. A charming, must-read both on Schelling and on Levitt’s views on the utility - or otherwise - of game theory. To my mind, Schelling represents the very best of game theory. He was a pioneer in the field, a man of ideas. Unfortunately for game theory, the simple ideas that are so alluring were quickly mined. What followed was less interesting. Modern game theory has become extremely mathematical, notation heavy, and removed from everyday life. Many of my colleagues would not agree with me, but I think game theory has failed to deliver on its enormous initial promise. I'm not the only one who feels this way. I was recently speaking with a prominent game theorist. He told me that if he knew what he knew and he were just getting started in the profession today, no way would he be a game theorist. [...]

Read more...

Chris

It's really interesting to hear about who influenced you as an economist. As a high schooler (senior), your book on economics really influenced me and my current view of economics. So much that I am currently considering a career in the field. Ive been working my way through your papers along with Mr. Roland Fryers and ive found them to be really interesting. Just wondering would you happen to know of any other good economic books out there? My Ap Econ. book is pretty good. Thanks

crazymonk.org » Levitt on Scheling | not the great american blog

[...] Steven D. Levitt of Freakonomics fame posts his remembrances of taking a class with game theorist Thomas Schelling. Schelling was one of the recent winners of Nobel Prize in Economics. [...]

AMG

Could someone point me to Schelling's quintessential book(s) (or papers) on Game Theory?

jayhoward

Hi Amg,

Schelling's seminal work on game theory, and the one he has received the most attention and acclaim for, is "The Strategy of Conflict." It was published first in either 1959 or 1960 against the backdrop of the Cold War nuclear standoff. It was republished in May 2007, but the original content was not revised or altered.

JV

Well.... I would be interested in why the prominent game theorist would not have chosen his field if he knew then what he knows now......

Roger Sweeny

The other essential Schelling is "Micromotives and Macrobehavior." Like "The Strategy of Conflict," it is a reprinting/reworking of older papers with connecting material to make a coherent whole. First published in 1978, amazon lists a 2006 "Rev. ed." I don't know how much "rev. has actually been done.

"Choice and Consequence" (1984) is a collection of essays that didn't make it into the two earler books. If you've read the books, you'll see a fair amount of repetition of ideas, but there is also some new stuff. If the two books excite you, it's probably worth reading.

Rok Spruk

The post is very thoughtful and it nicely outlines how important game theory really is to someone whose inspiration, whether as an economist or a strategist, is to think strategically. We examined the very basics of game theory at the Microeconomics lecture and it is really amazing to see how applicable basic mathematical concepts can really be in the field of game theory such as payoff matrix and prisoner dilemma. Schelling's work in the field of game theory is truly astonishing. I believe, it produced fascinating insights into the conflict/cooperation dilemma and broadened the horizon of the importance of strategic thinking and its consequences nevertheless.