# Barkley Rosser on Armen Alchian

## By:

Barkley Rosser has given me permission to reprint his story about Armen Alchian that he told on Marginal Revolution this morning. Here goes:

There is a curious story about Alchian from his work at RAND and from just after his seminal 1950 paper. He participated in the original prisoner’s dilemma game experiments run by the mathematicians Dresher and Flood, even prior to its being named by Al Tucker, John Nash’s major professor. The original experiments involved 100 repeated rounds. Alchian was one of the subjects along with a mathematician. Apparently the mathemetician was the first to try to cooperate, with Alchian taking his sweet time about reciprocating, but eventually did so, although this would break down just before the end, as expected. Nash was visiting at RAND at the time and was so upset at the failure of the subjects to follow his equilibrium and just defect all the time that he reportedly turned from working on game theory. As it was, in the experiment when the mathematician was trying to cooperate and Alchian was being the rational economic agent that Nash approved of, the mathematician reportedly became upset and asked somebody, “What is the matter with this guy? Can’t he figure out what is the best thing for both of us to do?” In any case, he did so eventually.

HT to Barkley Rosser and Wonks Anonymous.