Writing Worth Reading
Writing Worth Reading
This book is by a journalist, not an economist. It explains the work of John Nash, who was one of the leading lights of game theory. I chose it because game theory is such an important technique in economics and other sciences as well, particularly biology. But books about game theory tend to be pretty heavy going. This is a terrific book for just saying something about what game theory helps to do, without plunging you into all the complicated mathematics of how to do it in practice.
Lastly, A Beautiful Mind by Sylvia Nasar – which you’ve chosen because it is an accessible way to read about game theory?
This is a very different kind of book: it’s by a journalist, not an economist. It explains the work of John Nash, who was one of the leading lights of game theory. I chose it because game theory is such an important technique in economics and other sciences as well, particularly biology. But books about game theory tend to be pretty heavy going. This is a terrific book for just saying something about what game theory helps to do without plunging you into all the complicated mathematics of how to do it in practice.
Game theory is a really powerful technique for understanding the way people respond to each other’s behaviour – for thinking about what incentives they have to do things. What is something likely to make them do? And if they’re going to do that, then what does that imply for what I need to do to get the outcome that I want? It sounds terribly simple, but once you start thinking about it and taking that approach to how people decide anything, then you realise that it’s a tool for thinking about any kind of institution or decision-making context. Game theory was devised and applied originally in the context of making strategic decisions about warfare and the Cold War and nuclear weapons. But you can think about voting behaviour and political choices, you can think about economic decisions, you can think about business strategy. Pretty much any context, you can think about in terms of game theory: If he does this, then what do I do? What’s my strategy?
So even as a non-economist, I should be aware of its insights?
Absolutely. If you’re running a business, or you want to run for office in your local school district, it’s a good way of thinking about how to be successful. And there are, to be fair, some books – Barry Nalebuff’s is one that comes to mind – that do try to tell people how to apply it in practice, but A Beautiful Mind is a good read, and a good introduction as to how important it is and why John Nash deserved his Nobel Prize. Also, it’s an absolutely extraordinary human story – as anyone who saw the film will know.
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British economist Diane Coyle is head of Enlightenment Economics, a consultancy specialising in the economic and social effects of new technologies. Diane is Vice Chair of the BBC Trust and visiting professor at the University of Manchester. She was awarded the OBE in 2009
