Game Theory

Game theory has Austrian roots—Oskar Morgenstern was Mises's doctoral student—but the way it's taught leads almost everywhere to the same conclusion: individuals left alone reach bad outcomes, so the state must intervene. Lucas Engelhardt argues the reasoning has a hole in it. Standard analysis treats the game as fixed, when real people are entrepreneurial: alert to opportunity, able to see a bad equilibrium coming and restructure the payoffs before it arrives. Working through the tragedy of the commons, public goods, tariffs, and Huerta de Soto's account of why bankers lobbied for a central bank, he offers a better question—not what should government impose, but how will entrepreneurs change the game, and if they haven't, what's stopping them?Recorded at the Mises Institute in Auburn, Alabama, on July 23, 2026.Mises University is the world's leading instructional program in the Austrian School of economics, and is the essential training ground for economists who are looking beyond the mainstream.