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Biography
Michael Rothschild (born August 2, 1942 in Chicago, Illinois, United States) is an American economist; he is visiting professor at the Department of Economics of the University of California in Los Angeles (UCLA) and a former dean at Princeton.
Education
Rothschild holds a Bachelor of Arts in anthropology from Reed College (1963), and a Master of Arts in international relations from Yale University (1965). He earned his Doctor of Philosophy in economics from the Massachusetts Institute of Technology (1969).
Academic career
He was the William Stuart Tod Professor of Economics and Public Affairs at the Woodrow Wilson School of Public and International Affairs. He was dean of the Woodrow Wilson School of Public and International Affairs at Princeton University from 1995 through 2001. Rothschild has written on asymmetric information, decision-making under uncertainty, demography, investment, taxation, finance, and jury-decision processes.
He co-authored one of the most important papers in economics, Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information, with Joseph Stiglitz. This paper gives the first systematic exposition of the problem of cherry picking when insurance companies compete for customers. In Increasing Risk I: A definition, Rothschild and Stiglitz introduced the important decision theory concept of the mean-preserving spread, which leads to a partial ordering of probability distributions according to degree of risk.