Worldly wise, charming and ferociously intellectual, Leonid Hurwicz was, in the final year of his life, further distinguished by becoming the oldest laureate in the 40-year history of the Nobel Prize for economics.

Doubtless partially influenced by Poland’s experience of being forcibly recruited to Stalin’s socialist bloc, Hurwicz had in his youth looked towards alternatives to state planning as a means of attaining socially optimal economic outcomes.

The prewar depression had left evidence that, for its part, unfettered market capitalism could not be replied upon to supply consistently satisfactory results. Markets could and did fail, and had their limitations as much as did Stakhanovite production targets.

Seeking an alternative, Hurwicz deployed mathematics and game theory, in which he utilised the calculated prediction of individuals’ reactions to different incentives in games-playing or bargain-making structures. One problem faced by the planners of command economies was that individuals had no incentive to submit truthful information to the authorities. Hurwicz saw, however, that mechanisms, thoughtfully designed, could act as useful “message centres” through which individuals could make their actual preferences abundantly clear.

One such device could be a second- price auction, in which the seller marginally alters the rules of a usual auction such that while the highest bidder would still win, he or she would only pay the price bid by the bidder coming second, a tactic designed to coax forth more bids more truthfully reflecting each bidder’s estimate of the value of the object under bid.

Practically applied, with Hurwicz’s work developed by his fellow laureates Roger Myerson and Eric Maskin, mechanism design theory could lead to maximised production of socially useful goods — perhaps selected consumer items — or a minimisation of adverse products, such as atmosphere pollution. The theory represented a major breakthrough in economics, and transformed much of economic planning and decision-making worldwide.

But for Hurwicz the long wait for Nobel committee recognition — for decades perennially rumoured — brought great frustration. It was not until late 2007, when he was already 90, that the call came. His instinctive immediate reaction was that perhaps it was some “stupid joke”.

Accepting it, Hurwicz admitted to having given up hope of receiving it, adding that given the passing of decades and of many contemporaries, it had conspicuously played to his advantage that “for some reason, the Nobel prize has the requirement that the candidate should be alive”.

Leonid Hurwicz was born in Moscow in 1917, the son of Polish Jews. Having shortly after his birth returned to Poland, his family soon found itself menaced by the spectre — from both Nazi Germany and the Soviet Union — of anti-Semitic persecution. Hurwicz studied law at Warsaw university, earning an LLM in 1938. But he had evolved a preference for economics and he began PhD studies at the LSE. There he was influenced by, among others, the future fellow Economics Nobel laureate, Friedrich Hayek.

He moved for a spell to Geneva’s Graduate Institute of International Studies, but the outbreak of war then caused him to flee as a refugee to the US. Less fortunate members of his family were temporarily transported to Soviet labour camps before finally joining him in the US where he continued to develop his passion for economics.

He was attached at various times to MIT and the University of Chicago. At the latter he also taught statistics and participated at the Institute of Meteorology. In 1951 he joined the economics faculty at the University of Minnesota, which remained his professional base for the rest of his life.

Hurwicz was a longstanding pillar of the Minnesota Democrats, and in 1968 his trenchant opposition to the Vietnam war led him to support his fellow Minnesotan, the anti-war presidential candidate Eugene McCarthy, for whom Hurwicz sat as a delegate at the party’s national convention. Also a member of the Democrats’ platform committee that year, Hurwicz continued a serious engagement with politics, maintaining his party involvement, even up to and including the 2008 primary campaign battles of Barack Obama and Hillary Clinton.

Sometimes described as a “multidisciplinary renaissance scholar” Hurwicz exhibited learned expertise in subjects including mathematics, meteorology, music, linguistics, archeology and physics.

He was fondly recalled by students who appreciated the fact that he treated them as intellectual equals. One former pupil recalled Hurwicz’s dexterity of tact in attempting to mark with encouragement the halting advances of, in the context of economic theory, a less than outstanding undergraduate. “Ah,” said Hurwicz, perceiving an improvement, “now you are making really sophisticated mistakes.”

Hurwicz gave up academic life only in his eighties when afflicted by deafness. He won the Sveriges Riksbank’s Nobel prize for Economics in 2007. He also, in 1990, won the US National Medal of Science.

He married Evelyn Jensen in 1944. They had four children.

Leonid Hurwicz, economist, was born in Moscow on August 21, 1917. He died on June 24, 2008, aged 90