This is the classic work upon which modern-day game theory is based. What began as a modest proposal that a mathematician and an economist write a short paper together blossomed, when Princeton University Press published Theory of Games and Economic Behavior. In it, John von Neumann and Oskar Morgenstern conceived a groundbreaking mathematical theory of economic and social organization, based on a theory of games of strategy. Not only would this revolutionize economics, but the entirely new field of (...) scientific inquiry it yielded--game theory--has since been widely used to analyze a host of real-world phenomena from arms races to optimal policy choices of presidential candidates, from vaccination policy to major league baseball salary negotiations. And it is today established throughout both the social sciences and a wide range of other sciences. (shrink)

According to a popular narrative, in 1932 von Neumann introduced a theorem that intended to be a proof of the impossibility of hidden variables in quantum mechanics. However, the narrative goes, Bell later spotted a flaw that allegedly shows its irrelevance. Bell’s widely accepted criticism has been challenged by Bub and Dieks: they claim that the proof shows that viable hidden variables theories cannot be theories in Hilbert space. Bub’s and Dieks’ reassessment has been in turn challenged by (...) Mermin and Schack. Hereby I critically assess their reply, with the aim of bringing further clarification concerning the meaning, scope and relevance of von Neumann’s theorem. I show that despite Mermin and Schack’s response, Bub’s and Dieks’ reassessment is quite correct, and that this reading gets strongly reinforced when we carefully consider the connection between von Neumann’s proof and Gleason’s theorem. (shrink)

Two scenarios illustrate uses of von Neumann–Morgenstern stable sets in the construction of choice functions. A comparison is made to the construction of choice functions by the selection of maximal elements. A characterization is given of choice functions that are von Neumann–Morgenstern stable set rationalizable by acyclic, asymmetric binary relations. Two examples illustrate the use of the characterization.

Sequential von Neumann–Morgernstern (VM) games are a very general formalism for representing multi-agent interactions and planning problems in a variety of types of environments. We show that sequential VM games with countably many actions and continuous utility functions have a sound and complete axiomatization in the situation calculus. This axiomatization allows us to represent game-theoretic reasoning and solution concepts such as Nash equilibrium. We discuss the application of various concepts from VM game theory to the theory of planning and (...) multi-agent interactions, such as representing concurrent actions and using the Baire topology to define continuous payoff functions. (shrink)

This book represents the views of one of the greatest mathematicians of the twentieth century on the analogies between computing machines and the living human brain.

Book Reviews Paul Erickson, Economics and Philosophy, FirstView Article.

The invitation of the Organizing Committee for me to speak about “Unsolved problems in mathematics” fills me as it should with considerable trepidation and a prevailing feeling of personal inadequacy. Hilbert gave a talk on this subject at the similar congress about 50 years ago and this is a very formidable precedent. He stated about a dozen unsolved problems in another widely separated areas of mathematics, and they proved to be prototypical for much of the development that followed in the (...) next decades. It would be absolutely foolish, if I tried to emulate this quite singular feat. In addition I do not know the future and the future at any rate can only be predicted ex post with any degree of reliability. I will, therefore, define what I am trying to do in a much more narrow way, hoping that in this manner I have a better chance of not failing. I will limit myself to a particular area of mathematics which I think I know and I will talk about it and about what its open ends appear to be, particularly in some directions which are not the ones that the evolution so far has mainly emphasized and which are, I think, quite important. (shrink)

I wish to discuss some rather incomplete ideas concerning difficulties that arise in some parts of quantum mechanics. In general there have been no serious difficulties when we are dealing with a finite number of particles, but very essential difficulties arise as soon as we treat a system having an infinite number of degrees of freedom; for example, the theory of holes, which, because of the pair generation, requires an indefinite number of particles; also the Dirac non-relativistic theory of light (...) and the Pauli-Heisenberg relativistic quantum electro-dynamics, these being equivalent to systems consisting of an infinite number of particles. (shrink)

Shortly after Kurt Gödel had announced an early version of the 1st incompleteness theorem, John von Neumann wrote a letter to inform him of a remarkable discovery, i.e. that the consistency of a formal system containing arithmetic is unprovable, now known as the 2nd incompleteness theorem. Although today von Neumann’s proof of the theorem is considered lost, recent literature has explored many of the issues surrounding his discovery. Yet, one question still awaits a satisfactory answer: (...) how did von Neumann achieve his result, knowing as little as he seemingly did about the 1st incompleteness theorem? In this article, I shall advance a conjectural argument to answer this question, after having rejected the argument widely shared in the literature and having analyzed the relevant documents surrounding his discovery. The argument I shall advance strictly links two of the three letters written by von Neumann to Gödel in the late 1930 and early 1931 (i.e. respectively that of November 20, 1930 and that of January 12, 1931) and finds the key for von Neumann’s discovery in his prompt understanding of the Gödel sentence A – as the documents refer to it – as expressing consistency for a formal system that contains arithmetic. (shrink)

The issues, raised in Żukowski (arXiv:0809.0115v1, 2008), concerning the relevance of the von Neumann theorem for the single-system’s quantumness test proposed in Alicki and Van Ryn (J. Phys. A: Math. Theor. 41:062001, 2008) and performed for the case of single photon polarization in Brida et al. (Opt. Express 16:11750, 2008; arXiv:0811.3376, 2008) and the usefulness of Bell’s inequality for testing the idea of macroscopic quantum systems are discussed in some details. Finally, the proper quantum mechanical description of the (...) experiment with polarized photon beams is presented. (shrink)

In spite of the many efforts made to clarify von Neumann’s methodology of science, one crucial point seems to have been disregarded in recent literature: his closeness to Hilbert’s spirit. In this paper I shall claim that the scientific methodology adopted by von Neumann in his later foundational reflections originates in the attempt to revaluate Hilbert’s axiomatics in the light of Gödel’s incompleteness theorems. Indeed, axiomatics continues to be pursued by the Hungarian mathematician in the spirit of Hilbert’s (...) school. I shall argue this point by examining four basic ideas embraced by von Neumann in his foundational considerations: a) the conservative attitude to assume in mathematics; b) the role that mathematics and the axiomatic approach have to play in all that is science; c) the notion of success as an alternative methodological criterion to follow in scientific research; d) the empirical and, at the same time, abstract nature of mathematical thought. Once these four basic ideas have been accepted, Hilbert’s spirit in von Neumann’s methodology of science will become clear. (shrink)

This paper offers a modified version of the certainty equivalence (CE) theory of utility for uncertain prospects and a new set of axioms as its basis. It shows that the CE and the von Neumann-Morgenstern (NM) approaches to uncertainty are opposite in spirit: The CE approach represents a flight from the world of uncertainty to the rules of certainty while the NM approach represents a flight from the world of certainty to one of uncertainty. The two approaches differ (...) even in their treatment of compound prospects and their actuarially identical simple counterparts. (shrink)

Harsanyi claimed that his Aggregation and Impartial Observer Theorems provide a justification for utilitarianism. This claim has been strongly resisted, notably by Sen and Weymark, who argue that while Harsanyi has perhaps shown that overall good is a linear sum of individuals’ von Neumann-Morgenstern utilities, he has done nothing to establish any con- nection between the notion of von Neumann-Morgenstern utility and that of well-being, and hence that utilitarianism does not follow. The present article defends Harsanyi (...) against the Sen-Weymark cri- tique. I argue that, far from being a term with precise and independent quantitative content whose relationship to von Neumann-Morgenstern utility is then a substantive question, terms such as ‘well-being’ suffer (or suffered) from indeterminacy regarding precisely which quantity they refer to. If so, then (on the issue that this article focuses on) Harsanyi has gone as far towards defending ‘utilitarianism in the original sense’ as could coherently be asked. (shrink)

We discuss the content and significance of John von Neumann’s quantum ergodic theorem (QET) of 1929, a strong result arising from the mere mathematical structure of quantum mechanics. The QET is a precise formulation of what we call normal typicality, i.e., the statement that, for typical large systems, every initial wave function ψ0 from an energy shell is “normal”: it evolves in such a way that |ψt ψt| is, for most t, macroscopically equivalent to the micro-canonical density matrix. (...) The QET has been mostly forgotten after it was criticized as a dynamically vacuous statement in several papers in the 1950s. However, we point out that this criticism does not apply to the actual QET, a correct statement of which does not appear in these papers, but to a different (indeed weaker) statement. Furthermore, we formulate a stronger statement of normal typicality, based on the observation that the bound on the deviations from the average specified by von Neumann is unnecessarily coarse and a much tighter (and more relevant) bound actually follows from his proof. (shrink)

1.1 In 1955, John Harsanyi proved a remarkable theorem:1 Suppose n agents satisfy the assumptions of von Neumann/Morgenstern (1947) expected utility theory, and so does the group as a whole (or an observer). Suppose that, if each member of the group prefers option a to b, then so does the group, or the observer (Pareto condition). Then the group’s utility function is a weighted sum of the individual utility functions. Despite Harsanyi’s insistence that what he calls the (...) Utilitarian Theorem embeds utilitarianism into a theory of rationality, the theorem has fallen short of having the kind of impact on the discussion of utilitarianism for which Harsanyi hoped. Yet how could the theorem influence this discussion? Utilitarianism is as attractive to some as it is appalling to others. The prospects for this dispute to be affected by a theorem seem dim. Yet a closer look shows how the theorem could make a contribution. To fix ideas, I understand by utilitarianism the following claims: (1) Consequentialism: Actions are evaluated in terms of their consequences only. (2) Bayesianism: An agent's beliefs about possible outcomes are captured probabilistically. (3) Welfarism: The judgement of the relative goodness of states of affairs is based.. (shrink)

The present paper investigates the philosophical relationship between John von Neumann’s Nohidden-variable theorem and Bell’s inequalities. Bell erroneously takes the axiomatic method as implying a finality claim and thus ignores von Neumann’s strongly pragmatist stance towards mathematical physics. If one considers, however, Hilbert’s axiomatic method as a critical enterprise, Bell’s theorem improves von Neumann’s by defining a more appropriate notion of ‘ hidden variable’ that permits one to include Bohm’s interpretation which recovers the predictive content (...) of quantum mechanics. Contrary to Bell’s belief, accepting this model does not require adopting the metaphysically realist Böhm picture. If one takes the latter as a physical research programme one sees that it only partly disputes a common domain of facts with the mathematically oriented research programme of von Neumann. (shrink)

We show that the respective oversights in the von Neumann's general theorem against all hidden variable theories and Bell's theorem against their local-realistic counterparts are homologous. When latter oversight is rectified, the bounds on the CHSH correlator work out to be ±2√2 instead of ±2.

The renewed interest in the foundations of quantum statistical mechanics in recent years has led us to study John von Neumann’s 1929 article on the quantum ergodic theorem. We have found this almost forgotten article, which until now has been available only in German, to be a treasure chest, and to be much misunderstood. In it, von Neumann studied the long-time behavior of macroscopic quantum systems. While one of the two theorems announced in his title, the one (...) he calls the “quantum H-theorem,” is actually a much weaker statement than Boltzmann’s classical H-theorem, the other theorem, which he calls the “quantum ergodic theorem,” is a beautiful and very non-trivial result. It expresses a fact we call “normal typicality” and can be summarized as follows: For a “typical” finite family of commuting macroscopic observables, every initial wave function ψ0 from a micro-canonical energy shell so evolves that for most times t in the long run, the joint probability distribution of these observables obtained from ψt is close to their micro-canonical distribution. (shrink)

The paper discusses some of the poorly explored links between the conceptual systems of logic in Kurt Gödel, the theory of automata in Alan Turing, and the theory of self-reproducing automata in John von Neumann. Traditional controversies are left aside (especially the opposition of Gödel and Turing in the view of mind) and attention is focused on the similarities between all three authors. In individual chapters, the text deals with: the form of differentiation of syntax and semantics in formal (...) system in Gödel, Turing and von Neumann; von Neumann’s variant of Gödel’s theorem and von Neumann’s and Gödel’s conception of Turing machine; and finally the same basis of the view of the relation between mind and automaton in all three authors. (shrink)

We extend the topos-theoretic treatment given in previous papers of assigning values to quantities in quantum theory, and of related issues such as the Kochen-Specker theorem. This extension has two main parts: the use of von Neumann algebras as a base category (Section 2); and the relation of our generalized valuations to (i) the assignment to quantities of intervals of real numbers, and (ii) the idea of a subobject of the coarse-graining presheaf (Section 3).

I teoremi di Gödel suscitano un interesse sempre crescente nella riflessione filosofica contemporanea. Rimane però in discussione fra gli studiosi come si sia arrivati alla loro scoperta e quale sia il loro significato per il dibattito sui fondamenti delle scienze. Nel volume si ripercorrono le vicende che portarono alla formulazione dei teoremi di incompletezza, a partire dall’incontro tra von Neumann e Gödel al Congresso di Königsberg nel 1930, e si indaga, riferendosi in particolare al lavoro di von Neumann, (...) sull’impatto che questi teoremi hanno avuto per il progetto hilbertiano di fondazione della matematica e delle scienze più in generale. Ne risulta un’immagine delle indagini di Hilbert meno rigida di quella finora corrente, in linea con le più recenti acquisizioni della storiografia, e soprattutto più rispettosa della stessa prassi assiomatica, che oscillava per Hilbert tra ambizioni fondazionaliste e istanze pragmatiche. È stato von Neumann a rendere esplicita, dopo la scoperta dei teoremi di Gödel, quella che si può definire come la “svolta pragmatica” nell’assiomatica. Il libro propone inoltre un chiarimento riguardo alla scoperta di von Neumann del secondo teorema di incompletezza. (shrink)

The literature of economic theory, like that of philosophy, abounds in prefaces and prolegomena. Methodology and analysis of concepts take an important place in a science which has not found the sure path of development. But there is no sure path for methodology either. The selfconscious methodology of social science has been largely a borrowing from that of physical science, where procedures have developed to a stage of considerable maturity. But the analogy falls down where guidance is most needed, at (...) the points where social science is most likely to develop new concepts and new types of structure. Philosophers have not been lacking, indeed, to belittle the entire enterprise, and to deny the possibility of anything that could strictly be called social science. (shrink)

Although expected utility theory has proven a fruitful and elegant theory in the finite realm, attempts to generalize it to infinite values have resulted in many paradoxes. In this paper, we argue that the use of John Conway's surreal numbers shall provide a firm mathematical foundation for transfinite decision theory. To that end, we prove a surreal representation theorem and show that our surreal decision theory respects dominance reasoning even in the case of infinite values. We then bring our (...) theory to bear on one of the more venerable decision problems in the literature: Pascal's Wager. Analyzing the wager showcases our theory's virtues and advantages. To that end, we analyze two objections against the wager: Mixed Strategies and Many Gods. After formulating the two objections in the framework of surreal utilities and probabilities, our theory correctly predicts that (1) the pure Pascalian strategy beats all mixed strategies, and (2) what one should do in a Pascalian decision problem depends on what one's credence function is like. Our analysis therefore suggests that although Pascal's Wager is mathematically coherent, it does not deliver what it purports to, a rationally compelling argument that people should lead a religious life regardless of how confident they are in theism and its alternatives. (shrink)

The debate over the question whether quantum mechanics should be considered as a complete account of microphenomena has a long and deeply involved history, a turning point in which has been certainly the Einstein-Bohr debate, with the ensuing charge of incompleteness raised by the Einstein-Podolsky-Rosen argument. In quantum mechanics, physical systems can be prepared in pure states that nevertheless have in general positive dispersion for most physical quantities; hence in the EPR argument, the attention is focused on the question whether (...) the account of the microphysical phenomena provided by quantum mechanics is to be regarded as an exhaustive description of the physical reality to which those phenomena are supposed to refer, a question to which Einstein himself answered in the negative. However, there is a mathematical side of the completeness issue in quantum mechanics, namely the question whether the kind of states with positive dispersion can be represented as a different, dispersion-free kind of states in a way consistent with the mathematical constraints of the quantum mechanical formalism. From this point of view, the other source of the completeness issue in quantum mechanics is the no hidden variables theorem formulated by John von Neumann in his celebrated book on the mathematical foundations of quantum mechanics, the preface of which already anticipates the program and the conclusion concerning the possibility of ‘neutralizing’ the statistical character of quantum mechanics. (shrink)

This up-to-date introduction to decision theory offers comprehensive and accessible discussions of decision-making under ignorance and risk, the foundations of utility theory, the debate over subjective and objective probability, Bayesianism, causal decision theory, game theory, and social choice theory. No mathematical skills are assumed, and all concepts and results are explained in non-technical and intuitive as well as more formal ways. There are over 100 exercises with solutions, and a glossary of key terms and concepts. An emphasis on foundational aspects (...) of normative decision theory (rather than descriptive decision theory) makes the book particularly useful for philosophy students, but it will appeal to readers in a range of disciplines including economics, psychology, political science and computer science. • Has over 100 end of chapter review questions and exercises with solutions • Includes a chapter on how to draw a decision matrix • Explains the link between individual decision making, game theory and social choice theory Contents Preface; 1. Introduction; 2. The decision matrix; 3. Decisions under ignorance; 4. Decisions under risk; 5. Utility; 6. The mathematics of probability; 7. The philosophy of probability; 8. Why should we accept the preference axioms; 9. Causal vs. evidential decision theory; 10. Bayesian vs. non-Bayesian decision theory; 11. Game theory I: basic concepts and zero sum games; 12. Game theory II: nonzero sum and co-operative games; 13. Social choice theory; 14. Overview of descriptive decision theory; Appendix A. Glossary; Appendix B. Proof of the von Neumann-Morgenstern theorem; Further reading; Index. (shrink)

The renewed interest in the foundations of quantum statistical mechanics in recent years has led us to study John von Neumann’s 1929 article on the quantum ergodic theorem. We have found this almost forgotten article, which until now has been available only in German, to be a treasure chest, and to be much misunderstood. In it, von Neumann studied the long-time behavior of macroscopic quantum systems. While one of the two theorems announced in his title, the one (...) he calls the “quantum H-theorem,” is actually a much weaker statement than Boltzmann’s classical H-theorem, the other theorem, which he calls the “quantum ergodic theorem,” is a beautiful and very non-trivial result. It expresses a fact we call “normal typicality” and can be summarized as follows: For a “typical” finite family of commuting macroscopic observables, every initial wave function ψ0 from a micro-canonical energy shell so evolves that for most times t in the long run, the joint probability distribution of these observables obtained from ψ is close to.. (shrink)

We review the famous no-hidden-variables theorem in von Neumann’s 1932 book on the mathematical foundations of quantum mechanics. We describe the notorious gap in von Neumann’s argument, pointed out by Hermann and, more famously, by Bell. We disagree with recent papers claiming that Hermann and Bell failed to understand what von Neumann was actually doing.

It is a widespread belief that the Kochen-Specker theorem imposes a contextuality constraint on the ontology of beables in quantum hidden variables theories. On the other hand, after Bell’s influential critique, the importance of von Neumann’s wrongly called ‘impossibility proof’ has been severely questioned. However, Max Jammer, Jeffrey Bub and Dennis Dieks have proposed insightful reassessments of von Neumann’s theorem: what it really shows is that hidden variables theories cannot represent their beables by means of Hermitian (...) operators in Hilbert space. Hereby I show that i) the very same constraint can be derived from Gleason’s theorem, and that ii) if we consider the import of von Neumann’s and Gleason’s theorems, the relevance of the Kochen-Specker theorem for hidden variables theories gets substantially weakened: it does not force them to be contextual in any interesting sense of the term. (shrink)

Papers advocating a hidden-variable interpretation of quantum mechanics typically begin by emphasizing that John von Neumann’s no-go theorem does not apply to them. If authors are ontologically minded, their criticism also takes aim at his theory of measurement as expressed in his seminal 1932 book Mathematical Foundations of Quantum Mechanics Additionally, David Bohm and Basil Hiley have recently argued that “in so far as von Neumann effectively gave the quantum state a certain ontological significance, the net result (...) was to produce a confused and unsatisfactory ontology. This ontology is such that the collapse of the wave function must also have an ontological significance.”. (shrink)

How ought you to evaluate your options if you’re uncertain about which axiology is true? One prominent response is Expected Moral Value Maximisation, the view that under axiological uncertainty, an option is better than another if and only if it has the greater expected moral value across axiologies. EMVM raises two fundamental questions. First, there’s a question about what it should even mean. In particular, it presupposes that we can compare moral value across axiologies. So to even understand EMVM, we (...) need to explain what it is for such comparisons to hold. Second, assuming that we understand it, there’s a question about whether EMVM is true. Since there are many plausible rivals, we need an argument to defend it. In this paper, I’ll introduce a representation theorem for axiological uncertainty to answer these two questions. Roughly, the theorem shows that if all our axiologies satisfy the von Neumann–Morgenstern axioms, and if the facts about which options are better than which in light of your uncertainty also satisfy these axioms as well as a Pareto condition, then these facts have a relevantly unique expected utility representation. If I’m right, this theorem at once affords us a compelling way to understand EMVM—and specifically intertheoretic comparisons—and a systematic argument for its truth. (shrink)

Arrow’s axiomatic foundation of social choice theory can be understood as an application of Tarski’s methodology of the deductive sciences—which is closely related to the latter’s foundational contribution to model theory. In this note we show in a model-theoretic framework how Arrow’s use of von Neumann and Morgenstern’s concept of winning coalitions allows to exploit the algebraic structures involved in preference aggregation; this approach entails an alternative indirect ultrafilter proof for Arrow’s dictatorship result. This link also connects Arrow’s (...) seminal result to key developments and concepts in the history of model theory, notably ultraproducts and preservation results. (shrink)