Page last updated at 01:10 Asia/Manila, Saturday, 03 October 2015 PH
Last May 23, 2015, the famous Nobel laureate in economics and winner of the Abel Prize in mathematics, John Nash and his wife Alicia de Larde Nash were killed in a motor vehicle accident in New Jersey. Nash—popularized by Hollywood in the highly successful movie “The Beautiful Mind” with actor Russel Crowe playing the lead character—was 86 years old when he died. I first heard of this mathematical genius when I entered Harvard as a Ph.D. student in 1959. He was teaching at the nearby Massachusetts Institute of Technology (M.I.T.) and was known as a prodigy, having earned his Ph. D. from Princeton at the age of 21 after writing a doctoral dissertation containing only 32 pages on non-cooperative games, replete with mathematical equations. He was considered in the same league as equally famous Paul Samuelson, also a Nobel laureate in economics and the author of the most successful economics textbook in U.S. educational history, who was also teaching at M.I.T. at that time. Professor Samuelson obtained his Ph.D. in Economics from Harvard University by writing even a much shorter dissertation, all in mathematical equations, entitled “Foundations of Economic Analysis.” Samuelson was 26 when he earned his Ph.D.
Needless to say, I hardly could read any of the works of these two geniuses. As an accounting graduate then from the Philippines, I was still struggling with elementary calculus, which was never included in any business curriculum at that time (the only exception was the “Management Engineering” course at the Ateneo). My traumatic experiences with advanced calculus and matrix algebra in the first year of my graduate studies heavily influenced my strong stand when I was the first Dean of the CRC College of Arts and Sciences that calculus should be included as a required course in any liberal arts program. In today’s highly quantitative and data-intensive environment in any profession (I even exaggerated that it is true even in ballet dancing) part of general culture for any educated person should be an understanding of integral and differential calculus. No educated person should be daunted by references to first and second derivatives (not to be confused with the nefarious financial derivatives that led to the recent Great Recession).
At the same time, however, I cautioned my students that there are serious limits to the use of quantitative tools in the understanding of economic issues. There is a sense in which the likes of John Nash and Paul Samuelson did a disservice to the study of economics by giving the impression that this social science can be made as precise as physics and the other natural sciences. The subject matter of any social science is always the human being in his nature as a social or political animal. Because of free will, the behavior of human beings cannot be accurately predicted with the use of mathematical and statistical formulas. There is much to be gained in the understanding of economic phenomena such as success or failure in eradicating poverty and attaining a high level of per capita income by looking into the findings of other disciplines such as sociology, cultural anthropology, history, political science, philosophy and theology. That is why I believe that future economists should be well grounded in the humanities and the liberal arts so that they do not have the illusion that they can understand economic problems by using quantitative tools exclusively. I advised my students who want to study abroad to consider the PPE (Politics, Philosophy, and Economics) programs of British universities like Oxford and Cambridge. We have replicated these centuries-old curriculum in what we call Political Economy at the University of Asia and the Pacific.
John Nash nevertheless made significant contributions to what can be called “partial equilibrium” analysis in such areas as economics, computing, evolutionary biology, artificial intelligence, accounting, computer science (minimax algorithm which is based on Nash Equilibrium), games of skill, politics and military theory. Serving as a Señor Research Mathematician at Princeton University during the latter part of his life, he shared the 1994 Nobel Memorial Prize in Economic Sciences with game theorists Reinhard Selten and John Harsanyi. Just early this year, he was awarded the Abel Prize for his work on nonlinear partial differential equations (which up to this day I do not understand!).
In 1959, the year I entered Harvard, Nash began showing clear signs of mental illness and subsequently spent several years at psychiatric hospitals receiving treatment for paranoid schizophrenia. During all these years of mental sickness, his wife Alicia Lopez-Harrison de Larde, a naturalized U.S. citizen from El Salvador, stood by his side, taking care of him as a boarder in her own home (they divorced for a while but later remarried in 2001). Alicia, whom Nash married in Roman Catholic rites, was the image of the ever faithful companion, caring for her husband “in sickness and health.” And indeed, on that day of May 23, 2015, till death did they part, still united in the last moments of their life. I ask the pious reader to pray for the repose of their souls. Both of them are great in their own respective ways: one an intellectual giant and the other a model of unselfish love. For comments, my email address is email@example.com.