Market Design

Catalog description

The course covers Market Design, the analysis and engineering of market rules and institutions. In the last 60 years practitioners and academics have deliberately engineered the rules of an increasing number of markets, with classic examples including medical resident matching (e.g., NRMP), spectrum auctions (e.g., FCC auctions), and organ donation exchanges. In the last few years, very large markets have been created from scratch, such as eBay, Adwords, and smaller markets like odesk.com and sittercity.com. These designs use a broad set of tools, including economic theory, empirical analysis and experiments (and a fair dose of trial-and-error). With this experience, useful principles have emerged, on what market failures typically have to be addressed, and on which rules work and which do not.