If you saw the movie “A Beautiful Mind” and it inspired you to read Sylvia Nasar’s biography of John Forbes Nash, you bumped into the usual divergence between book and movie. As usual, the difference in medium has inspired a different way to put forth the message.

Nash freaks might be interested in knowing that this isn’t the first time that J. F. Nash entered the popular culture. The Jefferson Airplane album Crown of Creation (1968) contained the song “Ice Cream Phoenix,” which seems to be a careful twitting of the then fortysomething professor. Given that he seemed to be the informal mentor of Tim Leary – a confirmed what’s-his-game cynic in the 1950s – the connection is plausible, as is a teasing element to it. The fact that a man could be both the “young star” of a new branch of econometrics and also a raving schizophrenic was too implausible for straight belief back then. It’s probable that Nash’s schizophrenia was categorized inside the academy in the same way as Kurt Gödel’s paranoia was: as a “symptom” of a mind that was worn out through hard work – a sort of bad back of the brain. The hippie dropouts probably countered with a diagnosis which tried to make Nash one of their own.

Since much less was known about schizophrenia back then, and this relative lack of knowledge was replaced with the usual bias linking mental illness and uselessness, the young Nash wasn’t watched very closely for symptoms of pre- schizophrenia. He was just pegged as a young, promising eccentric who was too undisciplined for the program but whose promise might compensate for that ‘lackadasicalness’ at dissertation time. As the pivotal scene in the bar showed, he did deliver: his last-year self-browbeating led to his famous “Non-Co-Operative Games” paper in which he unveiled what is now known as the Nash equilibrium - equilibrium in a “game” is reached when each participant has selected what is their best personal move from the options available to them – which sealed his fame forever. You might be interested to know that his analysis of the chances each guy had of getting a date being increased by all the men shoving aside the most beautiful woman in favor of the others was based upon the assumption that the single-out maneuver was a co-operative zero-sum game, one straight out of von Neumann and Morgenstern. Nash’s reasoning assumed that the men (as a co- operative group) jilting the blonde in favor of all the other girls in the corresponding female group would turn the negotiations into a “simple majority game” where a coalition of people win against the member that was singled out. This is the kind of game which received the bulk of the attention in Theory of Games and Economic Behavior.

That perhaps acryphocal scene is most famous for his pronouncement that Adam Smith was wrong – that people simply pursing their self-interest in what is really a Ricardian manner (trying to snap up the best “opportunity” first in a manner similar to that of a foot race) leading inevitably to the most efficient outcome was false. This is the kind of talk that young men are well known for: set yourself against the dominant figure of economics; back it up; acquire followers using the “old fool” line as a rallying principle; and away you go. Had he pursued a more normal academic career, he most probably would have mellowed his anti-Smithian line.

It’s actually easy to work the above branch of game theory into the Smithian model: just posit the existence of a disinterested class. Since the losses of the singled-out person seem to involve opportunity losses, a class of people whose marginal utility of money is zero – who are utterly content with their economic lot – would bear the role of “loser” with equanimity. People that don’t give a damn about acquiring more money are like the blonde that doesn’t care about being humiliated in the bar to the benefit of her good friends; they probably have a similar attitude towards the common run of mankind as that blonde.

What the above implies is that, if many economic processes can accurately be modeled as co-operative zero-sum games, a free market will give rise spontaneously to a class of people who come to terms with their opportunity losses (which result from being at the lone end of the stick) by expressing disdain for the market, whose economic equivalent is zero-marginal- utility wealth-satiation. Or, to put it in a more lively way, the market gives rise to a group destitute of greed, which implies that the trust- fund set is always with us.

This dovetails rather neatly with a third kind of Smithian which I didn’t identify in my earlier discussion of the split between laissez-faire Smithians and the more modern kind. The third school of Smith derives, from his observation that people who aim to serve the public are rarely successful in their endeavors, the conclusion that the disinterested class is neither savior nor destroyer of the practical world of trade, but is simply impractical.

Note how this dovetails with the corresponding disdain for the market that such a disinterested class has an interest in believing, or expressing. The trust-fund boy sizes up the businessperson as “opportunistic,” and the businessperson sizes up the trust-fund set as “not having a head for business.” Also note that the categorizing of the disinterested class as ineffectual producers enables the Smithian to rise above the pro-business/anti-business fray by noting that people who are not capable in the world of trade have capabilities in other spheres. It allows the Smithian to work in the existence of the minister and the professional volunteer into society in such a way that is neither demeaning nor hagiographic.

Interesting that this “golden mean” is the interpretation that was buried during the high point of laissez-faire in the late 19th century. Here, we have a case of Americans going from refined to rude as time progresses, which might very well have been one of the breaches of the dam which ended the system of minimal government.