Roth - Who gets what-- and why : the hidden world of matchmaking and market design

Contents

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First published in Great Britain by William Collins in 2015

First published in the United States by Houghton Mifflin Harcourt in 2015

Copyright Alvin E. Roth 2015

Alvin E. Roth asserts the moral right to be identified as the author of this work.

A catalogue record for this book is available from the British Library.

All rights reserved under International and Pan-American Copyright Conventions. By payment of the required fees, you have been granted the non-exclusive, non-transferable right to access and read the text of this e-book on-screen. No part of this text may be reproduced, transmitted, down-loaded, decompiled, reverse engineered, or stored in or introduced into any information storage and retrieval system, in any form or by any means, whether electronic or mechanical, now known or hereinafter invented, without the express written permission of HarperCollins.

Source ISBN: 9780007520763

Ebook Edition June 2015 ISBN: 9780007520794

Version: 2015-04-13

To Ben and Aaron, Emilie, and Ted

Al Roth is the McCaw Professor of Economics at Stanford University and the Gund Professor of Economics and Business Administration Emeritus at Harvard. He is a member of the U.S. National Academy of Science, and a Fellow of the American Academy of Arts and Sciences and the Econometric Society, and has been a Guggenheim and Sloan fellow. Roth is one of the founders of the new economic discipline of market design. His paper The Economist as Engineer is one of the manifestos of the movement. He has also been one of the pioneers of experimental economics, and is a veteran game theorist. He shared the Nobel Prize in Economics in 2012.

Market design is a team sport, so I owe a great debt to all those who have worked on the markets reported here, many of whom are named in the course of telling the story. It turns out that making a book is also more of a team sport than I imagined. I received lots of help on this book, and would have received more if I were easier to help. Worth special mention are my agent, Jim Levine; Tim Gray, who conducted interviews of participants in kidney exchange and school choice; Mike Malone, who made my paragraphs shorter and clearer (and who knows a lot about Sooners); and my publisher, Eamon Dolan, who had clear ideas about what should be included in the book and what should not. Im also indebted to Barbara Jatkola for thoughtful copyediting, and to Atila Abdulkadirolu, Eric Budish, Neil Dorosin, Alexandru Nichifor, and Parag Pathak for careful reading and insightful comments.

The page numbers in this index relate to the printed version of this book; they do not match the pages of your ebook. You can use your ebook readers search tool to find a specific word or passage.

Abdulkadirolu, Atila, 35, 107, 153

on school choice, 12628, 165, 241, 243

activity rules, 18788

advertising, targeted, 18992

Advice to a Young Tradesman, Written by an Old One (Franklin), 200201

Affordable Care Act, 224

Airbnb, 99103, 116

algorithms

Boston Public Schools, 12228

computerized markets and, 22526

deferred acceptance, 14144

in Boston Public Schools system, 16265

in New York school choice program, 15561

for financial marketplaces, 8289

Internet dating sites, 17677

kidney exchange, 3538, 3941

for medical residencies, 13643

Roth-Peranson, 14849

stable outcomes from, 13943

Alliance for Paired Donation, 44, 49

Amazon, 2021, 22

congestion management in, 24

simplicity in, 26

American Economic Association, 174, 175

Android, 2122

anonymity, in commodity markets, 1920

antibiotics, 13334

Apple, 19

iPhone, 2122, 24

application and selection processes, 5. See also labor markets

for college admissions, 56, 169 17073

in law firm recruiting, 6568

signaling in, 16973

strategic decision making in, 1011

apps, 2122

Arunta people, 7172

Ashlagi, Itai, 48, 149, 239, 243, 244

auctions, 12122, 18089

ascending bid, 182, 184, 18889

eBay, 1045

first-price, 18485

package bidding in, 18889, 22526

price discovery in, 18589

sealed bid, 18284

second-price sealed, 18284

simultaneous ascending, 18789

for spectrum licenses, 18589

for targeted ads, 18992

automatic teller machines, 24

Avery, Chris, 91, 239

BandwidthX, 105

bankruptcy, 201

banks and banking, 178, 200201

banner ads, 19192

barriers to entry, 24

barter

kidney donation as, 3132

repugnant markets and, 2025

Becker, Gary, 245

behavioral economics, 52

Beran, Bob, 146

Beth Israel Deaconess Medical Center (Boston), 42

Bitcoin, 24

BlackBerry, 22

black markets, 207

blocking pairs, 13943

Bloomberg, Michael, 106, 107

Bolton, Gary, 118, 240

Boston Globe, 126

Boston Pool Plan, 138

Boston Public Schools, 11, 12228, 16265. See also algorithms

Bowl Championship Series, 6364

boxing, 7

Brigham and Womens Hospital (Boston), 42

British National Health Service, 14041

Brown, Janice Rogers, 97

Budish, Eric, 82, 86, 88, 239, 246

Burns, Adele, 42

Burns, Jack, 42

busing, 16667

California Penal Code, 19597

Carnegie Mellon University, 180

Catholic Church, 207

cell phones, 186. See also smartphones

central planning, 7, 14950, 16667

Chain, Ernst, 134

chains. See kidney transplants

cheap talk, 17677

checks (bank), 23

Chen, Yan, 12728, 241, 243

Cherokee Strip Land Run, 5758

Chicago Board of Trade, 1617, 82

Chicago Mercantile Exchange, 82

China, school matching in, 16566

Civil War, 203

clearinghouses. See also National Resident Matching Program (NRMP)

for British medical interns, 14041

for medical residencies, 13650

New York City school system, 112

in New York school choice program, 15561

preferences information for, 34

stable outcomes with, 13943

trading cycles and, 3241

Coca-Cola, 25

coercion, 203, 208

coffee, 1719

Coles, Peter, 244

college admissions, 56

acceptance rates in, 172

campus visits in, 178

deferred acceptance algorithm in, 14143