Leonid Hurwicz

AAA

DEFINITION of 'Leonid Hurwicz '

A professor of economics at the University of Minnesota and winner of the 2007 Nobel Prize in Economics, along with Eric Maskin and Roger Myerson, for his research on mechanism design. His theory says that competition is not really perfect because some individuals cheat, and that taking individuals' self-interest into account when designing business transactions can improve outcomes.

BREAKING DOWN 'Leonid Hurwicz '

Hurwicz was born in Moscow in 1917, but he grew up in Poland, where his family relocated when the communists came to power in Russia. As a Jew facing Nazi occupation of Europe, he escaped to the United States, specifically to Chicago, where he had relatives. He audited Ludwig von Mises's courses at the University of Chicago before ending up as a research assistant at the Massachusetts Institute of Technology under fellow economist and Nobel Laureate Paul Samuelson.



RELATED TERMS
  1. Perfect Competition

    A market structure in which the following five criteria are met: ...
  2. Keynesian Economics

    An economic theory of total spending in the economy and its effects ...
  3. Economist

    An expert who studies the relationship between a society's resources ...
  4. Dismal Science

    A term coined by Scottish writer, essayist and historian Thomas ...
  5. Microeconomics

    The branch of economics that analyzes the market behavior of ...
  6. Macroeconomics

    The field of economics that studies the behavior of the aggregate ...
Related Articles
  1. Economics

    Understanding Supply-Side Economics

    Does the amount of goods and services produced set the pace for economic growth? Here are the arguments.
  2. Options & Futures

    Nobel Winners Are Economic Prizes

    Before you try to profit from their theories, you should learn about the creators themselves.
  3. Economics

    The Uncertainty Of Economics: Exploring The Dismal Science

    Learning about the study of economics can help you understand why you face contradictions in the market.
  4. Options & Futures

    Explaining The World Through Macroeconomic Analysis

    From unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone.
  5. Entrepreneurship

    Elon Musk Success Story: Net Worth, Education & Top Quotes

    Read more about Elon Musk, the South African immigrant turned technology and engineering entrepreneur and inventor worth $13.6 billion.
  6. Entrepreneurship

    Mark Cuban Success Story: Net Worth, Education & Top Quotes

    Learn more about America's favorite billionaire: Mark Cuban, outspoken owner of the Dallas Mavericks and star of the hit show "Shark Tank."
  7. Entrepreneurship

    Janet Yellen Success Story: Net Worth, Education & Top Quotes

    Look into the life and academic career of Janet Yellen, the first female chair of the Federal Reserve and a noted Keynesian economist.
  8. Entrepreneurship

    3 Entrepreneurs Who Became Successful After 40

    Read about four influential entrepreneurs who didn't achieve fame and success until after their 40th birthdays, including the founder of Walmart.
  9. Investing Basics

    A Quick Guide On Behavioral Funds

    Investopedia explores the working of behavioral funds, their benefits and risks, and an analysis of their past returns.
  10. Entrepreneurship

    Adam Smith And "The Wealth Of Nations"

    Adam Smith's 1776 classic may have had the largest global impact on economic thought.
RELATED FAQS
  1. According to the neoclassical growth theory, what factors influence the growth of ...

    The neoclassical growth theory builds five major variables into its time-sensitive production formula. The first is total ... Read Full Answer >>
  2. What industries are typically considered infant industries?

    Infant industries are those considered vulnerable to established competitors. Some examples of infant industries include ... Read Full Answer >>
  3. How is game theory related to the Nash equilibrium?

    The Nash equilibrium is an important concept in game theory referring to a stable state in a game where no player can gain ... Read Full Answer >>
  4. How can individuals or businesses handle transaction costs for economic externalities?

    Externalities, also known as external economies, and transaction costs are two significant and evolving issues in contemporary ... Read Full Answer >>
  5. How can a change in fiscal policy have a multiplier effect on the economy?

    A change in fiscal policy has a multiplier effect on the economy because fiscal policy affects spending, consumption and ... Read Full Answer >>
  6. How do you calculate the marginal propensity to consume?

    The standard formula for calculating the marginal propensity to consume, or MPC, is marginal consumption divided by marginal ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Recession

    A significant decline in activity across the economy, lasting longer than a few months. It is visible in industrial production, ...
  2. Bubble Theory

    A school of thought that believes that the prices of assets can temporarily rise far above their true values and that these ...
  3. Stock Market Crash

    A rapid and often unanticipated drop in stock prices. A stock market crash can be the result of major catastrophic events, ...
  4. Financial Crisis

    A situation in which the value of financial institutions or assets drops rapidly. A financial crisis is often associated ...
  5. Election Period

    The period of time during which an investor who owns an extendable or retractable bond must indicate to the issuer whether ...
  6. Shanghai Stock Exchange

    The largest stock exchange in mainland China, the Shanghai Stock Exchange is a nonprofit organization run by the China Securities ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!