Monday, November 07, 2005

Games Nobel Prize Winners Play

In an interview in The Wall Street Journal, Thomas Schelling, game theorist and co-winner of this year's Nobel Prize in Economics, asserts that "terrorism is an almost miniscule problem." He points out that more people die from car accidents in three-and-a-half weeks in this country than died in the World Trade Center disaster. Also, when terrorism is compared with the common ways of dying (accidents, drowning, heart attacks, etc.), it is down near the bottom.

Clearly, he has a point. But the physical deaths caused by terrorists are only one element of the costs. Injuries add to the physical costs as does the destruction of buildings and other propety. Then, there is the psychological cost; people all over the globe are terrified about terrorism and their fear is not without costs. Most people believe that accidents or failing health happens to other people (until it happens to you) and act that way. Unfortunately, if you're living in Baghdad or Tel Aviv or Gaza, you find it hard to believe that bad things always happen to the other guy. You know that today there is a good chance that it may happen to you.

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