An invitation to market design

Scott Kominers, Alexander Teytelboym and Vincent Crawford

University of California at San Diego, Economics Working Paper Series from Department of Economics, UC San Diego

Abstract: Market design seeks to translate economic theory and analysis into practical solutions to real-world problems. By redesigning both the rules that guide market transactions and the infrastructure that enables those transactions to take place, market designers can address a broad range of market failures. In this paper, we illustrate the process and power of market design through three examples: the design of medical residency matching programmes; a scrip system to allocate food donations to food banks; and the recent 'Incentive Auction' that reallocated wireless spectrum from television broadcasters to telecoms. Our lead examples show how effective market design can encourage participation, reduce gaming, and aggregate information, in order to improve liquidity, efficiency, and equity in markets. We also discuss a number of fruitful applications of market design in other areas of economic and public policy.

Keywords: matching; auctions; trading; scrip; liquidity; efficiency; equity; allocation rules; marketplaces; market design; Applied Economics; Econometrics; Economics (search for similar items in EconPapers)
Date: 2017-11-02
References: Add references at CitEc
Citations: View citations in EconPapers (16)

Downloads: (external link)
https://www.escholarship.org/uc/item/3xp2110t.pdf;origin=repeccitec (application/pdf)

Related works:
Journal Article: An invitation to market design (2017)
Working Paper: An Invitation to Market Design (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cdl:ucsdec:qt3xp2110t

Access Statistics for this paper

More papers in University of California at San Diego, Economics Working Paper Series from Department of Economics, UC San Diego Contact information at EDIRC.
Bibliographic data for series maintained by Lisa Schiff ().