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Thursday, August 23, 2018

Oskar Morgenstern and qualitative economics


Photo source: Universitat Wien

Photo license: CC BY-NC-SA 4.0


Oskar Morgenstern (1902-1977) was a German economist best known for pioneering game theory and its application to economics with John von Neumann. Economist Leonid Hurwicz said,


"It would be doing [Morgenstern and von Neumann] an injustice to say that their is a contribution to economics only. The scope of the book is much broader. The techniques applied by the authors in tackling economic problems are of sufficient generality to be valid in political science, sociology or even military strategy." (The Theory of Economic Behavior, 1945)


The rest of this post is some quotes from Morgenstern.


Philosophy of economics


"All economic decisions, whether private or business, as well as those involving economic policy, have the characteristic that quantitative and non-quantitative information must be combined into one act of decision. It would be desirable to understand how these two classes of information can best be combined." (Quoted in industrial Planning in France by John McArthur and Bruce Scott)


"...the facts of economic life cannot be comprehensively described in terms of statistics." (Limits of the Use of Mathematics in Economics, 1963)


"At the present time there is an unmistakable tendency to consider only a contribution to mathematical economics as a contributions of value. Hence a certain craving to press everything into some mathematical form... This preoccupation appears to me to be unnecessary and possibly dangerous." (Limits of the Use of Mathematics in Economics, 1963)


"As far as the use of mathematics in economics is concerned, there is an abundance of formulas where such are not needed. They are frequently introduced, one fears, in order to show off. The more difficult the mathematical theorem, the more esoteric the name of the mathematician quoted, the better." (Limits of the Use of Mathematics in Economics, 1963)