The theory of games had its modern origins in a paper presented by the Hungarian-American mathematician John von Neumann before the Mathematical Society of Göttingen in 1928. In his paper, von Neumann outlined a mathematical system for determining the best strategy for a player who wants to achieve optimal results with minimal losses in some type of contest. Von Neumann analyzed the ways in which either of two players could make choices so that he or she could achieve the best possible "pay-off" after a given period of time in the game.

The application of mathematics to games and other types of contests did not originate with von Neumann, but can be traced at least to the seventeenth century. The French mathematician Abraham de Moivre was one of the first scholars to apply the mathematics of probability to practical situations. He developed formulas for calculating...