Dr. Vladimir A. Masch

President, Risk Evaluation and Management, Inc.

Vladimir Masch has been working in mathematical economics and adjacent fields (Operations Research, Decision Science, strategic risk management, scenario planning, policy making under radical uncertainty) since 1960. He has degrees of Doctor of Science in Economics (1972) and Ph.D. in Economics (1964), as well as an Academic Rank of Senior Research Fellow in the specialty “Mathematical Methods in Economic Research” (1969).

In 1963, Vladimir Masch (for brevity, VM) was one of 12 founders of a major think tank -- the Central Economic Mathematical Institute of the Academy of Sciences of the USSR, or CEMI, set up to wean away the USSR from the practices of command economy. At CEMI, he headed one of its most important units. Main line of work was modeling of long-range planning of the Soviet economy as a whole and of individual sectors of industry. He remained there until 1972, when he applied for emigration.

His most important work in the USSR included the development of a model for planning the Soviet economy by industries and regions (1964 – 1965). For several years, the model was a banner project of CEMI; by a government decree, 400 planning and research organizations provided the information for the model.

In 1967, VM discussed the model for two days with Professor Jan Tinbergen of Netherlands, the first (1969) Nobel winner in economics, who did not propose a single change. (In 1968, Tinbergen tried to help VM to leave the USSR with his family. He got VM a job offer from the UNESCO Institute, but Russians did not let him out.)

VM has developed not only the model, but also the algorithm for solving the enormous non-linear programming problem arising from that model. The problem had millions constraints and scores of millions of variables. It was successfully solved on computers able to handle much simpler linear programming models with only up to 400 constraints.

VM formulated the models and solved the problems of the long-range growth, development and plant location for a number of sectors of the USSR economy. The most important problem, both by its scope and the results achieved and implemented, was the coke coal industry (the second largest in the world) problem; the solution of the problem resulted in substantial investment in the industry and improvement of its activities.

VM founded the Russian school of modeling “multistage production and transportation systems,” later called in the USA “the supply chain”.

He also headed one of the earlier applications of scenario planning in economics (with 15 scenarios) -– a major project of locating in the USSR an automobile plant to be built by FIAT (1967). The government accepted the project recommendations; the plant was built in Togliatti.

All in all, recommendations of VM made from 1966 to 1971 led to four decisions made by the Soviet Government, the GOSPLAN of the USSR, and the Presidium of the Academy of Sciences of the USSR.

He applied for emigration in 1972 and was allowed to emigrate in 1973, thanks to invaluable help from the US. After arriving to the US in 1974, he worked initially at Bell Laboratories, and then as an independent scholar and consultant.

Currently VM is developing the theory of General Socio-Economics, or the discipline of making economic decisions beneficial to the society. As parts of that theory, he has originated two unique concepts of Risk-Constrained Optimizationâ (RCO) and “compensated free trade.”

RCO is an approach for solving complex socio-economic problems under radical uncertainty. Masch has been working on RCO since the 1960s. (An US patent was granted to RCO in 1999.) It embeds mathematical models in an ensemble of techniques that would neutralize potentially dangerous miscalculations. Perhaps the most important of these techniques is imposing on optimization models an additional function of “self-filtering,” so that they become very efficient “optimizing filters.” Thus, for the first time in more than 60 years, RCO legitimizes the high-level analytical use of a “computer -- optimization model” combination.

As for “compensated free trade,” VM originated the concept in 2004. If implemented, it would be the only system that, while controlling trade deficits, prevents trade wars. It would be a superb tool of both short- and long-term risk management. It also could be a tool of both diplomatic persuasion and geopolitical containment, a la Kennan, of potential rivals and adversaries.

VM is writing a book on “Politically Incorrect General Socio-Economics,” which covers both his criticism of the Anglo-American mainstream economics and his theory of “nudging” the markets in a socially beneficial direction.

He is an Associate Member of RUTCOR, Rutgers Center of Operations Research.

Articles and abstracts by VM can be obtained at

Dr. Vladimir A. Masch

President, Risk Evaluation and Management, Inc.