English Hebrew (pdf) Swedish Press Release: The Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel 2005 10 October 2005 The Royal Swedish Academy of Sciences has decided to award the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel, 2005, jointly to Robert J. Aumann
Center for Rationality, Hebrew University of Jerusalem, Israel and Thomas C. Schelling
Department of Economics and School of Public Policy, University of Maryland, College Park, MD, USA, "for having enhanced our understanding of conflict and cooperation through game-theory analysis". Conflict and cooperation through the lens of game theory Why do some groups of individuals, organizations and countries succeed in promoting cooperation while others suffer from conflict? The work of Robert Aumann and Thomas Schelling has established game theory – or interactive decision theory – as the dominant approach to this age-old question. Thomas Schelling Against the backdrop of the nuclear arms race in the late 1950s, Thomas Schelling's book The Strategy of Conflict set forth his vision of game theory as a unifying framework for the social sciences. Schelling showed that a party can strengthen its position by overtly worsening its own options, that the capability to retaliate can be more useful than the ability to resist an attack, and that uncertain retaliation is more credible and more efficient than certain retaliation. These insights have proven to be of great relevance for conflict resolution and efforts to avoid war. Schelling's work prompted new developments in game theory and accelerated its use and application throughout the social sciences. Notably, his analysis of strategic commitments has explained a wide range of phenomena, from the competitive strategies of firms to the delegation of political decision power. Robert Aumann In many real-world situations, cooperation may be easier to sustain in a long-term relationship than in a single encounter. Analyses of short-run games are, thus, often too restrictive. Robert Aumann was the first to conduct a full-fledged formal analysis of so-called infinitely repeated games. His research identified exactly what outcomes can be upheld over time in long-run relations. The theory of repeated games enhances our understanding of the prerequisites for cooperation: Why it is more difficult when there are many participants, when they interact infrequently, when interaction is likely to be broken off, when the time horizon is short or when others' actions cannot be clearly observed. Insights into these issues help explain economic conflicts such as price wars and trade wars, as well as why some communities are more successful than others in managing common-pool resources. The repeated-games approach clarifies the raison d’être of many institutions, ranging from merchant guilds and organized crime to wage negotiations and international trade agreements. Read more about this year's prize Supplementary Information Advanced Information (pdf) In order to read the text you need Acrobat Reader Links and Further Reading Robert J. Aumann, born 1930 (75 years) in Frankfurt, Germany (Israeli and US citizen). PhD in mathematics in 1955 from Massachusetts Institute of Technology (MIT), Cambridge, MA, USA. Professor at the Center for Rationality, Hebrew University of Jerusalem, Israel. Thomas C. Schelling, born 1921 (84 years) in Oakland, CA, USA (US citizen). PhD in economics in 1951 from Harvard University, Cambridge, MA, USA. Distinguished University Professor at the Department of Economics and School of Public Policy, Emeritus, at University of Maryland, College Park, MD, USA and Lucius N. Littauer Professor of Political Economy, Emeritus, at Harvard University. The Prize amount: SEK 10 million, will be shared equally between the Laureates. Contact persons: Fredrik All, Information Officer, phone +46 8 673 95 63, +46 706 73 95 63, fredrik@kva.se and Eva Krutmeijer, Head of Information, phone +46 8 673 95 95, +46 709 84 66 38, evak@kva.se
Los economistas Robert J. Aumann del ''Centro para la racionalidad'' de la Universidad Hebrea de Jerusalem en Israel y Thomas C. Schelling del ''Departamento de economía y de la escuela de políticas públicas'' de la Universidad de Maryland en los Estados Unidos fueron seleccionados por la Academia Real Sueca de las Ciencias para ser galardonados por el Premio del Banco de Suecia en Ciencias Económicas en memoria de Alfred Nobel conocido como el ''Premio Nobel de Economía'', "por sus aportes a la comprensión de los conflictos y la cooperación por medio del análisis de la Teoría de Juegos".

El libro de Thomas Schelling ''La estrategia de Conflicto'' de la década de 1950 estableció su visión de la teoría de juegos como el marco de referencia que unifica las ciencias sociales. Schelling mostró que es posible una parte enfrentada puede mejorar su posición al desmejorar sus opciones, que es preferible tener capacidad de responder a un ataque antes que defender una posición a toda costa y que en algunos casos, una respuesta ambigua da ventajas sobre una respuesta clara. La aplicación de estos principios resulta de gran relevancia para resolver conflictos y evitar una guerra. Sus trabajos dan una mayor comprensión sobre fenómenos como las estrategias de competencia que aplican algunas empresas.

Robert Aumann es pionero en el análisis formal de los llamados "juegos infinitamente repetidos" que modelan la cooperación a largo plazo entre partes en coflicto. Sus resultados identifican con precisión que resultados se pueden esperar de una relación a largo plazo, explican la razón por la cual las negociaciones ''multipartitas'' tienen menores oportunidades de resultar en acuerdo así como el efecto de las interrupciones de negociaciones en los resultados esperados. Estos resultados tienen aplicaciones también en la explicación de fenómenos como las guerras de precios o el manejo comunitario de recursos. También explican la existencia de asociaciones profesionales o del crimen organizado.