Leonid Hurwicz’s Nobel Prize-winning economic theory, mechanism design, relies on the probability that human beings cheat within an otherwise law-abiding economic model. His insight is perhaps unsurprising — coming of age as Hitler began his rampage through Europe, Hurwicz early on was exposed to the darker side of humanity.
Graduating from Warsaw University with a law degree in 1938, Hurwicz left Poland just before Hitler invaded, shipping his parents and brother off to the labor camps. Hurwicz bounced all over Europe, eventually finding his way to cousins in America. His family later joined him in the U.S.
Hurwicz’s mathematical equation for mechanism design allowed for the development of innovative solutions to problems that accounted for all parties’ self interests, and that were more realistic than situations projected by other economic models. But Hurwicz never lost his faith in the good of mankind, including in his theories how “intervenors,” or ethical people, can tip the economic scales back in the favor of justice.
By Lauren Clason