In 1956, Carnegie Tech obtained an IBM 650 computer, jointly acquired by GSIA and the engineering and mathematics departments, but housed in the basement of the business school.
The focus of the research was on organizational behavior and the application of decision analysis, management science, and psychology as well as theories such as bounded rationality to the understanding of the organization and the firm.
Members of that group include Franco Modigliani (…), John Muth, Merton Miller, and Allan Meltzer, to be joined later by Robert Lucas (…), Thomas Sargent (…), and Edward Prescott."
They were not always consistent with each other, as in the case of the conflict between John Muth’s suggestion about how to model expectations as “rational” and [Herbert] Simon’s notion of “bounded rationality.” We students benefited from the lively debates among the faculty.
The organizational branch included James G. March along with later GSIA dean and university president Richard Cyert and graduate students Oliver Williamson, William Starbuck and Victor Vroom.
Herbert Simon (1988) and his frequent collaborators Abraham Charnes and William Cooper (both 1982, jointly with Carnegie physicist Richard J. Duffin) also received the John von Neumann Theory Prize for their pioneering contributions to operations research and management science.
Statistician Carlton E. Lemke (1978, jointly with John Forbes Nash Jr., a Carnegie undergraduate), who wrote his dissertation at GSIA under Abraham Charnes, preceded all four.