Hugo Sonnenschein, Distinguished Fellow 2005
Hugo Sonnenschein has produced seminal papers in economic theory for forty years. His first paper in Econometrica in 1965 advanced the axiomatic approach to consumer choice that has since become the basis for that topic in first-year graduate microeconomics. His most recent article in the same journal, "Overcoming Incentive Constraints by Linking Decisions," with Matthew O. Jackson, examines the efficiency of collective decision-making. Between those two articles, he has written a stream of elegant and important papers, has mentored many leading economic theorists, and has served as Provost of Princeton University and President of the University of Chicago.
Sonnenschein's foremost contributions are in the theory of aggregation, deriving the implications for equilibrium outcomes of assumptions about individuals. One hope of early economic theorists was that mild assumptions about individual decision-making could ensure the existence of well-behaved market demand functions with properties beyond continuity and Walras's law. In a 1972 Econometrica article, "Market Excess Demand Functions," Sonnenschein showed that "an arbitrary polynomial can be generated as a market excess demand function." This result, and his other work during this period, effectively skewered the dream of establishing tight predictions about market demand with weak assumptions about individual preferences. With William Novshek and Wayne Shafer, Sonnenschein significantly expanded the set of economies where an equilibrium is known to exist. His early work on group decision-making, which dates to a 1972 paper, "General Possibility Theorems for Group Decisions," with Andreu Mas-Colell, and continues to have an impact to this day, can also be understood as an investigation of aggregation. As there is a reasonable case that the comparative advantage of economicsrelative to, say, psychology-is its ability to think about the equilibrium implications of assumptions about individuals, Sonnenschein's work in this area should be understood as a central contribution to our field.
Sonnenschein has also had a significant impact on the study of imperfect competition and the intellectual heritage of Cournot. His 1977 paper with John Roberts showed that quite standard assumptions about firm behavior and demand can lead to discontinuous firm behavior. With Novshek, he investigated information acquisition in Cournot duopoly. In 1968, he showed an important mathematicalink between two of Cournot's theories. In the 1980s, Sonnenschein switched his attention to game theory. His best known work in this area, developed in collaboration with Robert Wilson and Faruk Gul, provides the theoretical foundations for the Coase Conjecture.
Hugo Sonnenschein's contributions to economics are not limited to his writing. He is a legendary mentor of Ph.D. students who inspired a remarkable renaissance of economic theory at Princeton University. Even his brief forays into undergraduate teaching were life-changing events for some of his students. As a university administrator, he fought for academic excellence, especially in the quality of undergraduate education. Hugo Sonnenschein has given much to economics and beyond. He is a worthy Distinguished Fellow.