1969年上半年，CMU 與瑞典的 Gothenburg 大學在瑞典的Aspenäs 合開類似"電腦競賽與企業管理"會議*。 聊天時，談到剛創始的諾貝爾經濟學獎 (許多人認為，經濟學家與物理學等科學獎德主同台受獎，褻瀆諾貝爾獎......)。 瑞典的主要與會者，商業經濟學家 (business economist) Walter Goldberg** 轉向H. A. Simon 說，"You will receive the prize within ten years." Simon 自認為機會小，因為他50年代的主要學說有限理性 (Bounded Rationality) ，在美國似乎沒人提了..... (參考 Models of My Life By Herbert Simon, Basic Books, 1991, 頁320 (該章標題：From Nobel to Now . 我2020年8月31日才發現該頁錯把Gothenburg寫成Gothenberg。) *這次2周的會議，CMU 的幾位名師都參加，參考Organizing Industrial Development Rolf H. Wolff 編集Organizing Industrial Development - 378 ページ - Google ブック検索結果 **主要著作 Efficiency of Organizations
Herbert A. Simon The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 1978
Born: 15 June 1916, Milwaukee, WI, USA
Died: 9 February 2001, Pittsburgh, PA, USA
Affiliation at the time of the award: Carnegie Mellon University, Pittsburgh, PA, USA
Prize motivation: "for his pioneering research into the decision-making process within economic organizations."
Contribution: Work in a number of fields, including the methodology of science, applied mathematical statistics, operations analysis, economics, and business administration His work is synthesized in a new theory of organizational decision-making.
Prize share: 1/1
Life
Herbert Simon was born in Milwaukee, Wisconsin in the United States. His mother was a pianist and his father an electrical engineer who had migrated from Germany. His maternal uncle, an economist, sparked his interest in the social sciences. He first studied at the University of Chicago and was awarded a PhD in political science in 1943. After working at the University of California, Berkeley, and then at Illinois Institute of Technology in Chicago, he moved to Carnegie Mellon University in 1949. Herbert Simon was married with three children.
Work
Herbert Simon combined different scientific disciplines and considered new factors in economic theories. Established economic theories held that enterprises and entrepreneurs all acted in completely rational ways, with the maximization of their own profit as their only goal. In contrast, Simon held that when making choices all people deviate from the strictly rational, and described companies as adaptable systems, with physical, personal, and social components. Through these perspectives, he was able to write about decision-making processes in modern society in an entirely new way.
Iwas born in Milwaukee, Wisconsin, on June 15, 1916. My father, an electrical engineer, had come to the United States in 1903 after earning his engineering diploma at the Technische Hochschule of Darmstadt, Germany. He was an inventor and designer of electrical control gear, later also a patent attorney. An active leader in professional and civic affairs, he received an honorary doctorate from Marquette University for his many activities in the community. My mother, an accomplished pianist, was a third generation American, her forebears having been ’48ers who immigrated from Prague and Köln. Among my European ancestors were piano builders, goldsmiths, and vintners but to the best of my knowledge, no professionals of any kind. The Merkels in Köln were Lutherans, the Goldschmidts in Prague and the Simons in Ebersheim, Jews.
My home nurtured in me an early attachment to books and other things of the intellect, to music, and to the out of doors. I received an excellent general education from the public elementary and high schools in Milwaukee, supplemented by the fine science department of the public library and the many books I found at home. School work was interesting but not difficult, leaving me plenty of time for sandlot baseball and football, for hiking and camping, for reading and for many extracurricular activities during my high school years. A brother, five years my senior, while not a close companion, gave me some anticipatory glimpses of each stage of growing up. Our dinner table at home was a place for discussion and debate – often political, sometimes scientific.
Until well along in my high school years, my interests were quite dispersed, although they were increasingly directed toward science – of what sort I wasn’t sure. For most adolescents, science means physics, mathematics, chemistry, or biology – those are the subjects to which they are exposed in school. The idea that human behavior may be studied scientifically is never hinted until much later in the educational process – it was certainly not conveyed by history or “civics” courses as they were then taught.
My case was different. My mother’s younger brother, Harold Merkel, had studied economics at the University of Wisconsin under John R. Commons. Uncle Harold had died after a brief career with the National Industrial Conference Board, but his memory was always present in our household as an admired model, as were some of his books on economics and psychology. In that way I discovered the social sciences. Uncle Harold having been an ardent formal debater, I followed him in that activity too.
In order to defend free trade, disarmament, the single tax and other unpopular causes in high school debates, I was led to a serious study of Ely’s economics textbook, Norman Angell’s The Great Illusion, Henry George’s Progress and Poverty, and much else of the same sort.
By the time I was ready to enter the University of Chicago, in 1933, I had a general sense of direction. The social sciences, I thought, needed the same kind of rigor and the same mathematical underpinnings that had made the “hard” sciences so brilliantly successful. I would prepare myself to become a mathematical social scientist. By a combination of formal training and self study, the latter continuing systematically well into the 1940s, I was able to gain a broad base of knowledge in economics and political science, together with reasonable skills in advanced mathematics, symbolic logic, and mathematical statistics. My most important mentor at Chicago was the econometrician and mathematical economist, Henry Schultz, but I studied too with Rudolf Carnap in logic, Nicholas Rashevsky in mathematical biophysics, and Harold Lasswell and Charles Merriam in political science. I also made a serious study of graduate-level physics in order to strengthen and practice my mathematical skills and to gain an intimate knowledge of what a “hard” science was like, particularly on the theoretical side. An unexpected by-product of the latter study has been a lifelong interest in the philosophy of physics and several publications on the axiomatization of classical mechanics.
My career was settled at least as much by drift as by choice. An undergraduate field study for a term paper developed an interest in decision-making in organizations. On graduation in 1936, the term paper led to a research assistantship with Clarence E. Ridley in the field of municipal administration, carrying out investigations that would now be classified as operations research. The research assistantship led to the directorship, from 1939 to 1942, of a research group at the University of California, Berkeley, engaged in the same kinds of studies. By arrangement with the University of Chicago, I took my doctoral exams by mail and moonlighted a dissertation on administrative decision-making during my three years at Berkeley.
When our research grant was exhausted, in 1942, jobs were not plentiful and my military obligations were uncertain. I secured a position in political science at Illinois Institute of Technology by the intercession of a friend who was leaving. The return to Chicago had important, but again largely unanticipated, consequences for me. At that time, the Cowles Commission for Research in Economics was located at the University of Chicago. Its staff included Jacob Marschak and Tjalling Koopmans who were then directing the graduate work of such students as Kenneth Arrow, Leo Hurwicz, Lawrence Klein, and Don Patinkin. Oscar Lange, not yet returned to Poland, Milton Friedman, and Franco Modigliani frequently participated in the Cowles staff seminars, and I also became a regular participant.
That started me on a second education in economics, supplementing the Walrasian theory and Neyman-Pearson statistics I had learned earlier from Henry Schultz (and from Jerzy Neyman in Berkeley) with a careful study of Keyne’s General Theory (made comprehensible by the mathematical models proposed by Meade, Hicks, and Modigliani), and the novel econometric techniques being introduced by Frisch and investigated by the Cowles staff. With considerable excitement, too, we examined Samuelson‘s new papers on comparative statics and dynamics.
I was soon co-opted by Marschak into participating in the study he and Sam Schurr were directing of the prospective economic effects of atomic energy. Taking responsibility for the macroeconomic parts of that study, I used as my analytic tools both classical Cobb-Douglas functions, and the new activity analysis being developed by Koopmans. Although I had earlier published papers on tax incidence (1943) and technological development (1947), the atomic energy project was my real baptism in economic analysis. My interest in mathematical economics having been aroused, I continued active work on problems in that domain, mainly in the period from 1950 to 1955. It was during this time that I worked out the relations between causal ordering and identifiability – coming for the first time in contact with the related work of Herman Wold – discovered and proved (with David Hawkins) the Hawkins-Simon theorem on the conditions for the existence of positive solution vectors for input-output matrices, and developed (with Albert Ando) theorems on near-decomposability and aggregation.
In 1949, Carnegie Institute of Technology received an endowment to establish a Graduate School of Industrial Administration. I left Chicago for Pittsburgh to participate with G.L. Bach, William W. Cooper, and others in developing the new school. Our goal was to place business education on a foundation of fundamental studies in economics and behavioral science. We were fortunate to pick a time for launching this venture when the new management science techniques were just appearing on the horizon, together with the electronic computer. As one part of the effort, I engaged with Charles Holt, and later with Franco Modigliani and John Muth, in developing dynamic programming techniques – the so-called “linear decision rules” – for aggregate inventory control and production smoothing. Holt and I derived the rules for optimal decision under certainty, then proved a certainty-equivalence theorem that permitted our technique to be applied under conditions of uncertainty. Modigliani and Muth went on to construct efficient computational algorithms. At this same time, Tinbergen and Theil were independently developing very similar techniques for national planning in the Netherlands.
Meanwhile, however, the descriptive study of organizational decision-making continued as my main occupation, in this case in collaboration with Harold Guetzkow, James March, Richard Cyert and others. Our work led us to feel increasingly the need for a more adequate theory of human problem-solving if we were to understand decisions. Allen Newell, whom I had met at the Rand Corporation in 1952, held similar views. About 1954, he and I conceived the idea that the right way to study problem-solving was to simulate it with computer programs. Gradually, computer simulation of human cognition became my central research interest, an interest that has continued to be absorbing up to the present time.
My research on problem-solving left me relatively little opportunity to do work of a more classical sort in economics. I did, however, continue to develop stochastic models to explain the observed highly-skewed distributions of sizes of business firms. That work, in collaboration with Yuji Ijiri and others, was summarized in a book published just two years ago.
In this sketch, I have said less about my work on decision-making than about my other research in economics because the former is discussed at greater length in my Nobel lecture. I have also left out of this account those very important parts of my life that have been occupied with my family and with non-scientific pursuits. One of my few important decisions, and the best, was to persuade Dorothea Pye to marry me on Christmas Day, 1937. We have been blessed in being able to share a wide range of our experiences, even to publishing together in two widely separate fields: public administration and cognitive psychology. We have shared also the pleasures and responsibilities of raising three children, none of whom seem imitative of their parents’ professional directions, but all of whom have shaped for themselves interesting and challenging lives.
My interests in organizations and administration have extended to participation as well as observation. In addition to three stints as a university department chairman, I have had several modest public assignments. One involved playing a role, in 1948, in the creation of the Economic Cooperation Administration, the agency that administered Marshall Plan aid for the U.S. Government. Another, more frustrating, was service on the President’s Science Advisory Committee during the last year of the Johnson administration and the first three years of the Nixon administration. While serving on PSAC, and during another committee assignment with the National Academy of Sciences, I have had opportunities to take part in studies of environmental protection policies. In all of this work, I have tried – I know not with what success – to apply my scientific knowledge of organizations and decision-making, and, conversely, to use these practical experiences to gain new research ideas and insights.
In the “politics” of science, which these and other activities have entailed, I have had two guiding principles – to work for the “hardening” of the social sciences so that they will be better equipped with the tools they need for their difficult research tasks; and to work for close relations between natural scientists and social scientists so that they can jointly contribute their special knowledge and skills to those many complex questions of public policy that call for both kinds of wisdom.
This autobiography/biography was written at the time of the award and first published in the book series Les Prix Nobel. It was later edited and republished in Nobel Lectures. To cite this document, always state the source as shown above.
Herbert A. Simon died on February 9, 2001.
Herbert Simon
Prize Lecture
Lecture to the memory of Alfred Nobel, December 8, 1978
Rational Decision-Making in Business Organizations
”Jews were required to wear the Star of David and to obey a 6 p.m. curfew. I had gone to play with a Christian friend and had stayed too late. I turned my brown sweater inside out to walk the few blocks home. As I was walking down an empty street, I saw a German soldier approaching. He was wearing the black uniform that I had been told to fear more than others - the one worn by specially recruited SS soldiers. As I came closer to him, trying to walk fast, I noticed he was looking at me intently. Then he beckoned me over, picked me up, and hugged me. I was terrified he would notice the star inside my sweater. He was speaking to me with great emotion, in German. When he put me down, he opened his wallet, showed me a picture of a boy, and gave me some money. I went home more certain that ever that my mother was right: people were endlessly complicated and interesting.”
The interest in human behaviour started from an early age for Daniel Kahneman. Psychologist and economist Daniel Kahneman was awarded the 2002 Prize in Economic Sciences "for having integrated insights from psychological research into economic science, especially concerning human judgment and decision-making under uncertainty." Who do you think will be awarded this year's Prize in Economic Sciences?
Correction Appended
Two Americans have won this year's Nobel award in economics for trying to explain idiosyncrasies in people's ways of making decisions, research that has helped incorporate insights from psychology into the discipline of economics.
Daniel Kahneman, a professor of psychology and public affairs at Princeton University, who is also a citizen of Israel, and Vernon L. Smith, a professor of economics and law at George Mason University in Fairfax, Va., shared the prize, which is worth approximately $1.07 million before taxes. Their work shed light on strategies for explaining everything from stock market bubbles to regulating utilities and countless other economic activities.
In many cases, the winners tried to explain apparent paradoxes. For example, Professor Kahneman made the economically puzzling discovery that most of his subjects would make a 20-minute trip to buy a calculator for $10 instead of $15, but would not make the same trip to buy a jacket for $120 instead of $125 -- saving the same $5. ''It took me several years,'' Professor Smith said at a news conference yesterday, ''to realize that the textbooks were wrong, and the people in my class were correct.''
Though the two winners will now inevitably be grouped together, they approached their field from very different backgrounds. ''Kahneman's a psychologist -- he's interested in how your brain works, how you make decisions,'' said Alvin E. Roth, an economist at Harvard who specializes in experimental methods. ''Smith is an economist. He's interested in how markets work.''
With different goals came different approaches, and sometimes conflicting conclusions. Professor Smith originally set out to demonstrate how well economic theory worked in the laboratory, according to Richard H. Thaler, an economist at the University of Chicago who studies behavioral patterns. By contrast, Professor Kahneman, and his longtime collaborator, Amos Tversky, who died in 1996, ''were more interested in the ways that economic theory mispredicted,'' he said.
Both winners of the award -- the Nobel Memorial Prize in Economic Science -- tested the limits of the standard economic theory of choice in predicting the actions of real people. The theory assumes that individuals make decisions systematically, based on their preferences and available information, in a way that changes little over time or in different contexts. By the late 1970's, Professor Kahneman and Mr. Tversky had begun to perform experiments with human subjects that suggested seemingly irrational wrinkles in behavior.
In a 1981 article, they reported results of a study in which 152 students were given hypothetical choices for trying to save 600 people from a disease. Using one strategy, exactly 200 people could be saved for certain. Using another, there would be a one-third chance everyone would live, and a two-thirds chance no one would be saved. Seventy-two percent of the subjects, preferring the less risky strategy, chose the first option. But when the researchers presented 155 other students with the same choice worded differently -- either 400 people would die for sure or there would be a one-third chance that no one would die -- only 22 percent chose the first option.
The difference, Professor Kahneman and Mr. Tversky explained, stemmed from the presentation of the options as sure gains or sure losses. People in their experiments generally shunned risk when gains, like lives saved, were in question -- they wanted to lock in the gains with certainty. Yet people preferred risk when the alternative was a certain loss, even if taking the risk implied the chance of an even greater loss.
Professor Smith's work formalized laboratory techniques for studying economic decision making, with a focus on trading and bargaining. In the early 1960's, he was among the first economists to make experimental data a cornerstone of his academic output. His studies included people playing games of cooperation and trust and simulating different types of markets in a laboratory setting.
The choices of the two men for the prize left few academic economists completely surprised. Both Professor Roth and Professor Thaler said they had an inkling of the Nobel committee's leanings last year, after attending a meeting on behavioral and experimental economics at a Swedish symposium celebrating the 100th anniversary of the Nobel prizes. And Professor Kahneman was among the favorites in a betting pool for economists, according to Siva Anantham, a Harvard graduate student who administers the pool.
Behavioral economics and experimental methods have become hot topics for graduate students in some of the nation's top economics departments. ''Many of the best and the brightest young graduate students are interested in these issues, and they're getting good jobs,'' Professor Thaler said. Universities in the United States, Europe, Israel and Japan have opened centers dedicated to behavioral and experimental economics in the last few years.
David I. Laibson at Harvard credited the rapidly rising interest in the subject to the strength of its science. ''The field is based primarily on work that reflects real people's choices,'' he said. ''In that sense, the findings have an inherent validity.''
Though this year's prize was the first to reward such work, the Nobel committee has long shown an interest in the nexus of economics and psychology. Maurice Allais, who won the prize in 1988, demonstrated how economic theory broke down when used to predict people's choices between different sets of lotteries. And human beings' limited capacity to digest information needed to make complex decisions was a prime concern of Herbert A. Simon, an American who won in 1978.
Many economists' laboratory experiments use ideas about competitive interactions pioneered by game theorists like John Forbes Nash Jr., who shared the Nobel in 1994, as points of reference. But behavioral economists often concentrate on cases where people's actions depart from the systematic, rational strategies Professor Nash and his counterparts envisioned.
At his news conference at Princeton yesterday, Professor Kahneman expressed regret that the recognition of the value of behavioral economics did not come quickly enough for Mr. Tversky to share in the recognition. The prize committee cited him in its news release, but Nobel prizes are not awarded posthumously. This award is the second time in recent years that a deceased researcher in economics has been mentioned by the committee. Fischer Black, one of the architects of a popular model for pricing options, received recognition when Robert C. Merton and Myron S. Scholes, with whom he collaborated, won the prize in 1997.
Unlike the five other Nobel Prizes, the award in economics was not set up by the will of Alfred Nobel, the Swedish inventor of dynamite who died in 1896. It has been awarded by the Royal Swedish Academy of Sciences, with sponsorship from the Bank of Sweden, only since 1968.
Photos: Vernon L. Smith, an economics and law professor at George Mason University in Virginia, was originally trying to demonstrate how well economic theory worked in the laboratory.; Daniel Kahneman, a psychology and public affairs professor at Princeton, and both an American and Israeli citizen, took several years ''to realize that the textbooks were wrong.'' (Photographs by Associated Press)
Correction: October 12, 2002, Saturday Because of an editing error, a picture caption in Business Day on Thursday with an article about the two winners of the Nobel award in economics this year misattributed remarks by one of them. It was Vernon L. Smith, professor of economics and law at George Mason University -- not Daniel Kahneman, professor of psychology and public affairs at Princeton -- who said it had taken him several years ''to realize that the textbooks were wrong.''
