In 1944, mathematician John von Neumann and economist Oskar Morgenstern published Theory of Games and Economic Behavior, a work that would eventually transform economics, political science, biology, psychology, and military strategy. Their central insight was deceptively simple: rational decision-making cannot be analyzed in isolation because the outcomes of most real decisions depend not only on what you choose but on what other people choose simultaneously. When your optimal choice depends on what others do, and their optimal choice depends on what you do, the entire framework of individual optimization breaks down. What is needed is a new framework for analyzing...