Oskar Morgenstern, 1902-1976.

Oskar Morgenstern was groomed in the Austrian tradition, but was considerably less dogmatic in his tastes.  Succeeding Hayek in 1931 as director of the Austrian Institute for Business Cycle research, Morgenstern's research interests were not in the Hayekian monetary overinvestment theory, but rather in speculation and economic prediction (the subject of his 1928 habilitation thesis).  A professor at the University of Vienna in 1935, Morgenstern was also an active participant in Karl Menger's Vienna Colloquium and employed Abraham Wald in his institute.   He was also one of the great critics of the Austrian theory of capital, helping to bury the notion of the "average period of production".

His 1935 article on the difficulties of perfect foresight, which stemmed partly from his Austrian training, and the greater generality of "strategic behavior" over "robinson-crusoe", price-taking behavior, led the mathematician Edward Cech to put him in touch with John von Neumann 1928 article on games.     After Morgenstern was dismissed by the Nazis in 1938, he moved on to Princeton, where he finally met von Neumann.  Together, Morgenstern and John von Neumann wrote their famous treatise on the theory of games (1944), which not only launched  game theory but also the theory of choice under uncertainty. Morgenstern provided much of the economic analysis in that book.

Morgenstern continued working on a variety of themes, notably a reworking of the von Neumann multi-sector growth model (with Kemeny and Thompson, 1956, 1976), on national defense (1959), on economic data (1950) and on finance, notably the testing of the emerging random walk hypothesis (with Granger, 1970).

Major works of Oskar Morgenstern

• Wirtschaftsprognose: Eine untersuhung ihrer Voraussetzungen und Moglichkeiten, 1928.
• Die Grenzen der Wirtschaftspolitik, 1934.
• "The Time Moment in Value Theory", 1935, ZfN.
• "Perfect Foresight and Economic Equilibrium", 1935, ZfN.
• "Logistics and the Social Science", 1936, ZfN.
• Theory of Games and Economic Behavior with John von Neumann, 1944.
• "Demand Theory Reconsidered", 1948, QJE.
• "Economics and the Theory of Games", 1949, Kyklos.
• On the Accuracy of Economic Observations, 1950.
• Prolegomena to a Theory of Organization, 1951
• "Experiment and Large-Scale Computation in Economics", 1954, Economic Activity Analysis.
• "Generalization of the von Neumann Model of an Expanding Economy", with J.G. Kemey and G.L. Thompson, 1956, Econometrica
• The Question of National Defense, 1959.
• Predictability of Stock Market Prices, with C.W.J. Granger, 1970.
• "Thirteen Critical Points in Contemporary Economic Theory", 1972, JEL.
• "Descriptive, Predictive and Normative Theory", 1972, Kyklos.
• "Some Reflections on Utility", 1976, in Allais and Hagen, editors, Rational Decisions under Risk.
• "Collaborating with von Neumann", 1976, JEL.
• Mathematical Theories of Expanding and Contracting Economies, with G.L. Thompson, 1976.

Resource on Oskar Morgenstern

• HET Pages: von Neumann-Morgenstern Expected Utility Hypothesis, the von Neumann System
• Oskar Morgenstern Papers at Duke University
• Morgenstern Page at Laura Forgette
• Morgenstern page at Britannica.com