This site is very much a work in progress! Since Adek, Zina and Leo returned to Warsaw early in probably February , Leo would have been less than a year and a half old when this statement was made. These frameworks include incentive compatibility and mechanism design. He was at the time the oldest person ever to receive a Nobel Prize in any category. One of his earlier contributions, presented in an article , was the Hurwicz Criterion , which offers a formula for balancing optimism and pessimism when making decisions under uncertainty.
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Reprinted with permission from the author and Twin Cities Business magazine. Professor Hurwicz says that he is simply a product of his history. Leonid Hurwicz was born in Moscow on August 21, after the Kirensky revolution but before the October Bolshevik revolution. But I know we traveled in various imperfect ways, such as horse-drawn wagon, to arrive in Poland. In Warsaw a five-year internship was required to practice law, so he taught history while completing that. It was a time of pogroms throughout Europe.
Though he and his family were not swept up in anything so frightening, Hurwicz does recall strange, random attacks. One year, the university in Warsaw decided the Jewish community had not contributed its share of corpses to the medical school. When a group tried to force Jewish students to sit in a segregated section of their classrooms, the university rector failed to intervene.
The Jewish students, including Leo, stood in the back of the room for the entire year in protest. The protest succeeded and the following year Jewish students were seated again. And with my professors, I felt no discrimination. So Hurwicz went to France and then Switzerland on a transit visa. By the spring of , they had been arrested and taken to a labor camp in Arctic European Russia.
He spent months in Geneva, enrolled part time as a student, living off what little money he had left, and hoping for news of his family. Hurwicz contacted his cousins in Chicago, whom his parents had told him would help if he needed to leave. His ticket was now worthless because no Italian ship could enter American ports. An airline opened briefly between Switzerland and Barcelona, both neutral cities. Hurwicz was able to fly to Spain and take a train to Madrid, then Lisbon.
With a refund and the little he had earned tutoring, Hurwicz booked passage on the Greek boat. In fact, it was a miracle I had this one. At MIT, Hurwicz tested a hypothesis about how businesses arrive at prices for their goods and services.
He returned to Chicago in mid-June , by now a more desirable candidate for academic appointment. Again, world events dictated his course. After Pearl Harbor was bombed in December , Hurwicz went to his statistics professor and asked how he could help the war effort.
The professor, engaged in research on a brand new invention called radar, brought him onto the project. This led to an appointment with the Institute of Meteorology at the University of Chicago, where Hurwicz taught prospective Army and Navy inductees statistics, mathematics and physics needed to analyze weather data. At Chicago, he hired, sight unseen, a young meteorology assistant from Wisconsin named Evelyn Jensen.
They were married in July of ; the first of their four children was born two years later. But in early , with McCarthyism rampant on college campuses, his politically liberal colleagues in the economics department were targeted, and Hurwicz resigned in protest. Soon afterward, he heard from an Iowa friend who had moved north and thought Hurwicz should consider joining the economics department at the University of Minnesota. Within a couple of months, Hurwicz moved his family to Minneapolis, where he would develop the idea that would win him the Economy Prize.
But actually, there is usually some chapter, not too long, which tells you there are different mechanisms that operate in a particular economy… My question was, What other systems or mechanisms or variables are possible? He developed mechanism design to help businesses and other organizations arrive at solutions that combine truthfulness, individual rationality, and social welfare.
Then there is the true game, the one like real life, where the strategies and moves people make, some of them contain illegal gains. So you take into account when you write the rules of the game that the players will try to cheat. But when he began working on it in the s, the idea of factoring in the self-interest of players in business transactions was considered cutting edge. He and his colleagues believed that incentives could encourage players to arrive at the best possible outcome not only for themselves but for the other players in the game.
An old coal-burning energy plant is spewing pollutants. In the not-so-distant past, the response would be for a government regulator to simply demand that the utility reduce emissions or be shut down. But there are problems with this approach. The government establishes a cap to limit emissions. The emissions allowed under the new cap are then divided up into individual permits that give producers the right to emit that amount.
Companies are free to buy and sell these permits. Those who can reduce emissions at a low cost do so, then sell their permits at a profit to companies that continue to pollute. Those high polluters thus have an incentive to reduce their own emissions.
Mechanism design builds on game theory, which arose in the s as a mathematical means of studying various interactions, including business negotiations and transactions. Hurwicz translated the lessons of oppression into a now global belief system that is equal parts economics and philosophy, and that helps solve specific problems in the real world. The same is true, Hurwicz postulates, in business, where a handful of righteous individuals can rebalance an equation thrown off kilter by dishonest peers.
From Les Prix Nobel. The information is sometimes updated with an addendum submitted by the Laureate. Leonid Hurwicz died on June 24,
Reprinted with permission from the author and Twin Cities Business magazine. Professor Hurwicz says that he is simply a product of his history. Leonid Hurwicz was born in Moscow on August 21, after the Kirensky revolution but before the October Bolshevik revolution. But I know we traveled in various imperfect ways, such as horse-drawn wagon, to arrive in Poland. In Warsaw a five-year internship was required to practice law, so he taught history while completing that.
His parents and brother fled Warsaw, only to be arrested and sent to Soviet labor camps. Hurwicz, who had graduated from Warsaw University in , at the time of Nazi invasion on Poland was in London, moved to Switzerland then to Portugal and finally in he emigrated to the United States. His family eventually joined him there. They married on July 19,  and later lived at a number of locations in Minneapolis. They had four children: Sarah, Michael, Ruth and Maxim. He remained an active Democrat, and attended his precinct caucus in February at the age of