The Minimax Theorem.

A major innovation in applied mathematics during the 1940s was the use of game theory to create models of economic and social behavior. Game theory analyzes conflicts by creating mathematical models of them. Mathematician John Von Neumann presented the minimax theorem, an initial contribution to the theory, in 1929. The minimax theorem applies to "zero-sum," or no-win games, pure rivalries in which one side's gain is the other's loss. Von Neumann and economist Oskar Morgenstern, both of Princeton University, explained their methods of creating mathematical models of conflicts in their 1944 book, Theory of Games and Economic Behavior.

"Non-Zero-Sum" Games.

Another game theorist at Princeton in the late 1940s was John Nash, whose dissertation (1950) elaborated on Von Neumann's theory. Focusing on "non-zero-sum" games, Nash described "winwin" rivalries, in which mutual gain is possible, "loselose" contests, in which both sides could lose, and...