University of Maryland Economist Wins Nobel Memorial Prize in Economics

Thomas C. Schelling Click here for hi-res image

COLLEGE PARK, Md. - University of Maryland economist Thomas C. Schelling has won the 2005 Nobel Memorial Prize in Economics for his work in game theory analysis. He shares the award with Robert J. Aumann of Hebrew University in Jerusalem.

The Royal Swedish Academy of Sciences awarded the prize today to Schelling and Aumann "for having enhanced our understanding of conflict and cooperation through game-theory analysis." More details are available from nobelprize.org.

Schelling, emeritus distinguished university professor in the Department of Economics and the School of Public Policy, has published highly influential works in a number of areas including nuclear proliferation and arms control, terrorism, organized crime, energy and environmental policy, climate change and racial segregation. His work on nuclear deterrence helped shape Cold War strategies. He joined the University of Maryland faculty in 1990. Schelling's Economics webpage has a short biography. Prof. Schelling's C.V. is also available.

"I'm deeply honored by this recognition," Schelling says. "I've been doing this for over 50 years and it's hard to find a shorthand way to describe my interests. But in my mind it all comes together, and what links this work is my fascination with how people react to and influence others - as individuals and as nations."

Alice and Thomas Schelling

Schelling began his career in 1945, working for the U.S. Bureau of the Budget, and later served as an advisor in the Truman administration. He taught for many years at Yale and Harvard, and has been honored with membership in the National Academy of Sciences, the Institute of Medicine and as a fellow in the American Academy of Arts and Sciences.

"There is no higher recognition than the Nobel Prize, and there is no greater distinction for the university than to have Nobel Laureates on the faculty," says University of Maryland President C.D. Mote Jr. "All of us in the university community salute and celebrate his achievement." This is the third Nobel Prize awarded to a member of the University of Maryland faculty.

We also have broadcast quality audio of the news conference .

A major part of Schelling's work has focused on arms control and nuclear deterrence. In 1993, the National Academies honored him "for his pioneering work in the logic of military strategy, nuclear war, and arms races which has profoundly influenced our understanding of this crucial subject."

Schelling says he remains optimistic that an unwritten taboo against the use of nuclear weapons may continue to hold, even amid the pressures of nuclear proliferation, just as it has for 60 years. "My main source of optimism is that the Soviet Union faced some of its gravest challenges without ever resorting to nuclear weapons," he says. "It was not a foregone conclusion they would honor this nuclear taboo with their backs to the wall." Schelling has applied these same principles in other contexts as well, for example, looking at the strategy and tactics of bargaining and negotiation involved in industrial and labor conflict. "Some people have described me as a game theorist, but this is wrong. I'm simply a user of game theory," Schelling says.

Another strand of his research has involved the interactive behavior of crowds, ethnic groups, neighborhoods and entire populations, applied to such topics as segregation and integration. "For his entire career, Tom Schelling has been at the forefront in advancing our understanding of risk and uncertainty in topics ranging from climate change to arms control," says Edward Montgomery, dean of the University of Maryland School of Behavioral and Social Sciences. "His work has had a revolutionary impact on our thinking and practice."

"I don't know anyone more deserving," says Steve Fetter, dean of the Maryland School of Public Policy. "Tom is an extraordinarily creative and penetrating thinker who has made major contributions in a wide range of fields, from nuclear strategy and arms control to the economics of climate change. He also has been a superb colleague and a wonderful teacher, greatly enriching the intellectual life of the School of Public Policy."

University of Maryland Nobel Laureates

With this award, Schelling becomes the third University of Maryland Nobel Laureate. William Phillips won the Nobel Prize for Physics in 1997. Juan Ramon Jimenez won the Nobel Prize for Literature in 1956.

Nobel Memorial Prize

Formally known as "The Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel," the award is given by the Royal Swedish Academy of Sciences according to the same principles that have guided the Nobel Prizes since 1901. Schelling will deliver his Nobel Lecture on Dec. 8 in Stockholm, Sweden. The award itself will be bestowed at ceremonies there on Dec. 10.

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