Vernon L. Smith quote: “One of the most intriguing discoveries of experimental economics is that (1) as we have seen, people invariably behave …”

“The first dimension is called "competition," and it refers to that aspect of an economic system in which exchanges of one sort or another play the most important part. In capitalism, of course, competition and exchange occur primarily in markets.”

Samuel Bowles (1939) American economist

Source: Understanding Capitalism: Competition, Command, and Change, 2005, p. 54

“We are ready to expand the friendly people-to-people exchanges and enhance exchanges and cooperation in science, technology, culture, education, and other areas.”

Hu Jintao (1942) former General Secretary of the Communist Party of China

2000s, White House speech (2006)

“We will continue to pursue the strategy of boosting domestic demand and ensure fast and balanced economic and social development in China. This will create more opportunities for China-U. S. economic cooperation and trade. We will continue to advance the reform of the RMB exchange rate regime, take positive steps in such areas as expanding market access, increasing imports, and strengthening the protection of intellectual property rights, and further expand China-U. S. economic cooperation and trade.”

Hu Jintao (1942) former General Secretary of the Communist Party of China

2000s, White House speech (2006)

“An analysis of social relations in 2 parts: the properties of 2-person relations, and an extension of the chief concepts to the complex relations of larger groups. Beginning with the assumption that most social interactions must be reinforced to be repeated, the authors analyze 2-person matrices designed to express all the possible interactions and their outcomes in terms of rewards and costs to the participants. Also investigated are: the exogenous and endogenous determinants of rewards and costs, interactive interference and facilitation, formation and evaluation of the 2-person relation, power and dependence, norms and roles, tasks, and nonvoluntary relations. The chapters on larger groups take up interdependence, status, conformity, and group goals. 300-item bibliog”

John Thibaut (1917–1986) American social psychologist

Abstract
The social psychology of groups. 1959

“The writer has, by such a treatment, obtained values for all finite two-person cooperative games, and some special n-person games.”

John Nash (1928–2015) American mathematician and Nobel Prize laureate

"Non-cooperative Games" in Annals of Mathematics, Vol. 54, No. 2 (September 1951)
1950s
Context: The writer has developed a “dynamical” approach to the study of cooperative games based upon reduction to non-cooperative form. One proceeds by constructing a model of the preplay negotiation so that the steps of negotiation become moves in a larger non-cooperative game [which will have an infinity of pure strategies] describing the total situation. This larger game is then treated in terms of the theory of this paper [extended to infinite games] and if values are obtained they are taken as the values of the cooperative game. Thus the problem of analyzing a cooperative game becomes the problem of obtaining a suitable, and convincing, non-cooperative model for the negotiation.
The writer has, by such a treatment, obtained values for all finite two-person cooperative games, and some special n-person games.

“We should continue to abide by the principles of putting aside differences and seeking consensus, and put economics before politics in handling cross-strait relations. This is why we are focused on cross-strait exchanges in the area of economic and trade cooperation.”

Wu Po-hsiung (1939) Taiwanese politician

Wu lauds DPP’s China department (2012)

“Property rights, governance structures and rules of exchange are arenas in which modern states establish rules for economic actors. States provide stable and reliable conditions under which firms organize, compete, cooperate and exchange. The enforcement of the laws affects what conceptions of control can produce stable markets. There are political contests over the content of laws, their applicability to given firms and markets, and the extent and direction of state intervention into economy. Such laws are never neutral. They favor certain groups of firms.”

Neil Fligstein (1951) American sociologist

Source: Markets as politics: A political-cultural approach to market institutions, 1996, p. 657

“We shall here define the market as a set of social institutions in which a large number of commodity exchanges of a specific type regularly take place, and to some extent are facilitated and structured by those institutions. Exchange as defined above, involves contractual agreement and the exchange of property rights, and the market consists in part of mechanisms to structure, organize and legitimate these activities. Markets, in short, are organized and institutionalized exchange. Stress is placed on those market institutions, which help to both regulate and establish a consensus over prices and, more generally, to communicate information regarding products, prices, quantities, potential buyers and potential sellers.”

Geoffrey Hodgson (1946) British economist

Source: Economics and Institutions, 1988, p. 174

“Certain contemporary overenthusiastic market socialists tend, contrariwise, to forget that the market is intrinsically repugnant, because they are blinded by their belated discovery of the market's instrumental value. It is the genius of the market that it (1) recruits low-grade motives to (2) desirable ends; but (3) it also produces undesirable effects, including significant unjust inequality. In a balanced view, all three sides of that proposition must be kept in focus, but many market socialists now self-deceptively overlook (1) and (3). Both (1) and (2) were kept in focus by the pioneering eighteenth-century writer Bernard Mandeville, whose market-praising Fable of the Bees was subtitled Private Vices, Public Benefits. Many contemporary celebrants of the market play down the truth in the first part of that subtitle.”

Gerald Cohen (1941–2009) Canadian philosopher

IV. Is the Ideal Feasible?
Why Not Socialism? (2009)

“The writer has developed a “dynamical” approach to the study of cooperative games based upon reduction to non-cooperative form.”

John Nash (1928–2015) American mathematician and Nobel Prize laureate

"Non-cooperative Games" in Annals of Mathematics, Vol. 54, No. 2 (September 1951)
1950s
Context: The writer has developed a “dynamical” approach to the study of cooperative games based upon reduction to non-cooperative form. One proceeds by constructing a model of the preplay negotiation so that the steps of negotiation become moves in a larger non-cooperative game [which will have an infinity of pure strategies] describing the total situation. This larger game is then treated in terms of the theory of this paper [extended to infinite games] and if values are obtained they are taken as the values of the cooperative game. Thus the problem of analyzing a cooperative game becomes the problem of obtaining a suitable, and convincing, non-cooperative model for the negotiation.
The writer has, by such a treatment, obtained values for all finite two-person cooperative games, and some special n-person games.

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Vernon L. Smith 20

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