Thomas Schelling

McGeorge Bundy, the Dean of Harvard's Faculty of Arts and Sciences, claimed in 1955 that a university which does not try to develop to a maximal degree the interest, cooperation and understanding between its staff members and those of the National Defence Forces is not doing its full job.

Thomas Schelling, who is best known for his work on game theory, wrote of a new academic profession that grew in size and influence in the 1950s before moving in 1961 into the establishment, the Departments of State and Defence.

The founder of MIT's political science department, Ithiel de Sola Poole, called the rising class of academics the New Mandarins, an allusion to an educated, unelected bureaucratic elite capable of influencing policy and administration.

Scholars who later looked back on that period, however, did not see influence, but rather servitude.

A Harvard historian, John Trumpbore, wrote that reason, sometimes of a specialized technocratic variety, had been put at the service of the national security apparatus.

He called it reason in the service of empire.

Reason in the service of empire was exemplified by Thomas Schelling's claim that the United States had exercised quote unquote restraint during the Korean War because it did not bomb anywhere in China or use nuclear weapons.

In reality, as historian Charles Armstrong explains, the US Air Force dropped more bomb tonnage on North Korea, including napalm, than it had dropped on the entire Pacific theater during World War Two, killing a staggering 10 to 15 percent of the population.

And then those guys are going to be the ones who will solve the dispute, okay? And the game theory in it is that you have...

There's a system that we developed that is inspired by a game theorist called Thomas Schelling that is about people who are jurors in the cases are rewarded based on them being coherent with the majority of the other jurors.

And if they take their time and make a good decision and... evaluate the evidence and all they will tend to be in coherence with the rest and they will make money if they just vote randomly or they just don't care and vote whatever they are likely to be on the wrong side of the of the majority and then they will lose money this is a system that rewards people for honest honest behavior uh that we invented and this is one of the key components of decentralized justice so this is the nutshell is like a This idea of crowdsourced users that can come from anywhere.

And this idea of economic incentives to this token that enables them to become honest in this system to produce very, very fast, very cheap and fair rulings for the cases they have to solve.

And the reason that common knowledge is necessary is that merely knowing the other person's intention is not enough.

If you imagine a rendezvous, let's say, to take an example from Thomas Schelling that initiated this field of research more than 60 years ago.

Imagine a couple separated in New York.

They don't have working cell phones.

I think the simplest answer may be that it's for generating common knowledge.

Can you explain that and when you kind

of arrived at this conclusion? So going back to the Thomas Schelling's dilemma of the separated couple who have to find each other.

Now, of course, if they had functioning cell phones, there'd be no dilemma.

I mean, you know, so I don't know who thought that.

I mean, well, I know where it came from, right? Because Tom Schelling told me, well, you know, if you want people to pay attention to this, then write down the simplest model that you can.

where there's a signaling effect.

And by simplest,