ESMT Open Lecture and book presentation with Alvin E. Roth
Alvin E. Roth: "Who Gets What and Why: The New Economics of Matchmaking and Market Design"
"Who Gets What and Why: The New Economics of Matchmaking and Market Design"
March 9, 2016
Moderator: Christoph von Marschall, Managing Editor, Der Tagesspiegel
In this lecture, economist and Nobel prize winner Alvin E. Roth illuminated the everyday world of matching markets in organ donation, public school choice programs, college admissions, and online dating. Unlike commodity and equity markets, where price alone determines allocation, in matching markets one is not free to choose but rather must also be chosen. The “market design” school, of which Roth is a pioneer, aims to remedy matching markets that are not “thick” enough (lacking sufficient participants) or suffer from “congestion” (an overwhelming range of options). He notes, for example, that over 100,000 people in the US are waiting for kidney transplants, yet only 11,000 non-directed kidneys become available each year. As a solution, using market-design principles Roth helped to design the New England Program for Kidney Exchange. Through this and other examples, Roth’s lecture explored the complicated dynamics involved in matching markets.