 | von Neumann and Morgenstern found game theory — expected utility, strategic interaction, and cooperative solutions — rational choice under shared rules, not psychology alone. von Neumann First published 1944 - Edition (2007) · Princeton University Press · ISBN 9780691130613 |
|---|
Key principles
- Expected utility axiom — Preferences over lotteries — rational choice needs consistent ordering.
- Two-person zero-sum — Minimax solution — adversarial optimum when gains equal losses.
- Many-player extension — Coalitions and characteristic function — cooperation reshapes payoffs.
- Strategic form games — Simultaneous move matrix — predict equilibrium, not story alone.
- Cooperative solution concepts — Fair division and stable sets — bargaining is mathematics plus ethics.
- Common knowledge assumption — Mutual awareness of rules — real rooms violate this often.
Core science
Theory of Games and Economic Behavior (1944) launched mathematical game theory — foundation for economics, political science, and AI multi-agent work. On the Codex shelf pair with Cost-benefit matrix when decisions need explicit payoff structure.
Application
Reach for this volume when game theory or cost-benefit matrices need von Neumann’s foundation — before intuitive negotiation without payoff map. Open Cost-benefit matrix on the Atlas shelf for the mechanism map.