About Lloyd Stowell Shapley, Nobel Prize in Economic Sciences 2012
Lloyd Stowell Shapley (born June 2, 1923) is a distinguished American mathematician and economist. He is a Professor Emeritus at University of California, Los Angeles (UCLA), affiliated with departments of Mathematics and Economics. He has contributed to the fields of mathematical economics and especially game theory. Since the work of von Neumann and Morgenstern in 1940s, Shapley has been regarded by many experts as the very personification of game theory. With Alvin E. Roth, Shapley won the 2012 Nobel Memorial Prize in Economic Sciences "for the theory of stable allocations and the practice of market design."
Lloyd Shapley was born on June 2, 1923, in Cambridge, Massachusetts, one of the sons of the distinguished astronomer Harlow Shapley. He was a student at Harvard when he was drafted in 1943, and in the same year, as a sergeant in the Army Air Corps in Chengdu, China, he received the Bronze Star decoration for breaking the Soviet weather code. After the war, he returned to Harvard and graduated with an A.B. in mathematics in 1948. After working for one year at the RAND Corporation, he went to Princeton University where he received a Ph.D. in 1953. His thesis and post-doctoral work continued the ideas of Francis Ysidro Edgeworth introducing the Shapley value and the core solution concept in game theory. After graduating, he remained at Princeton for short time before going back to the RAND corporation from 1954 to 1981. He married Marian Ludolph in 1955 (with whom he has two sons, Peter and Christopher). Since 1981 he has been a professor at UCLA.
Along with the Shapley value, stochastic games, the Bondareva-Shapley theorem (which implies that convex games have non-empty cores), the Shapley–Shubik power index (for weighted- or block voting power), the Gale–Shapley algorithm (for the stable marriage problem), the concept of a potential game (with Dov Monderer), the Aumann–Shapley pricing, the Harsanyi–Shapley solution, and the Shapley–Folkman lemma& theorem bear his name.
Besides, his early work with R.N.Snow and Samuel Karlin on matrix games was so complete that little has been added since. He has been instrumental in the development of utility theory, and it was he who laid much of the groundwork for the solution of the problem of the existence of Von Neumann-Morgenstern stable sets. His work with M.Maschler and B.Peleg on the kernel and the nucleolus, and his work with Robert Aumann on non-atomic games and on long-term competition have all had a tremendous impact in economic theory.
In his 80s, Shapley continues publishing his old results, such as multi-person utility and authority distribution (a generalization to the Shapley–Shubik power index and useful in ranking, planning and group decision-making).
In 1950, Lloyd Shapley invented the board game So Long Sucker, along with Mel Hausner, John Forbes Nash, and Martin Shubik.
Awards and honors, Selected publications: