DAVID M. KREPS

Theodore J. Kreps Professor of Economics and Senior Associate Dean

Graduate School of Business
Stanford University, USA


Excerpt from David M. Kreps' essay:
 

With permission of the editors, I’m framing my contribution to this volume as follows.  First, I will give short answers to the “autobiographical” questions #1 and #2.   Then, in lieu of answers to the more philosophical questions, I attach the text of remarks I made on January 6, 2007, to a luncheon hosted by the American Economic Association at the ASSA Meetings, held to honor the 2005 Nobel Laureates in Economics, Thomas Schelling and Robert Aumann.   I have nearly unbounded admiration for the work of these two pioneers, and I think one can hardly do better than to examine their work, when trying to describe what work in game theory ought to look like, or what have been the most important accomplishments of the subject in the latter portion of the 20th century, or what directions the subject should take now.  For readers interesting in a more direct version of my views on the subject, I suggest the Clarendon Lectures I gave a while ago, published as Game Theory and Economic Modelling (Oxford University Press, 1990); my remarks concerning Professors Schelling and Aumann will, I hope, provide a synopsis of those views, while at the same time giving an account of the contributions of these two giants.  I close by briefly connecting (stylistically) my own modest work to that of Schelling and Aumann.

1. Why were you initially drawn to game theory?

As a graduate student at Stanford University and, subsequently, as an Assistant Professor in the business school there, I was privileged to be able to attend the summer meetings of the Institute for Mathematical Studies in the Social Sciences, the IMSSS.  Among the perennial “principals” of this summer-long series of seminars were Ken Arrow, Mordechai Kurz, Frank Hahn, Bob Aumann, Eytan Sheshinski, and Robert Wilson; Michael Rothschild, Joe Stiglitz, and Mike Spence were there at least some of the time; Gerard Debreu, Roy Radner, and John Harsanyi were frequent visitors from Berkeley.  It seemed that the whole world of economic theory passed through, and I got to sit in the back of the room and drink it all in.

To be sure, nothing that I was working on at the time could be called game theory.   My interests (in terms of research) have always centered on topics connected to dynamic choice and dynamic behavior.   As an undergraduate (before coming to Stanford), both in my senior thesis and at summer jobs at Bell Laboratories, I worked on optimal stopping problems; my Ph.D. dissertation in Operations Research concerned the theory of dynamic programming.  This led me to work in two directions, axiomatic choice theory---emphasizing dynamic choice---and dynamic models of financial markets.   But, at the same time, I was fortunate to be able to see and hear a lot of game theory and, in particular, the first connections being made between noncooperative game theory and substantive issues raised in information economics.  It was an exciting time, and when, a few years later, I began work on problems connected to game theory, it seemed a natural intellectual progression.

 

Read the remaining part of David M. Kreps' interview in Game Theory: 5 Questions, edited by Vincent F. Hendricks and Pelle Guldborg Hansen. The book is released in April 2007 by Automatic Press / VIP.

ISBN 87-991013-4-3
(paperback)
248 pages / $26 / £16

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