Who Gets What—and Why: The New Economics of Matchmaking and Market Design
Last read August 29, 2016
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Highlights
10 highlights.
Markets differ from central planning because no one but the participants themselves determines who gets what. And marketplaces differ from anything-goes laissez-faire because participants enter the marketplace knowing that it has rules.
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Repugnance shows with particular clarity what
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all markets reveal: people’s values, desires, and beliefs.
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“What do you know when you see a green plant in the desert?” he asked. I shook my head, and he exclaimed: “It’s poison! Otherwise something would have eaten it by now.”
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The key to such a clearinghouse is making it safe for people to state their preferences honestly.
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flawed markets can undermine not just communities but whole nations. The Berlin Wall was a monument to that fact.
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paradox of market design that as communication gets easier and cheaper, it sometimes also gets less informative.
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When talk is cheap, it doesn’t reliably signal anything.
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That’s why one of the ancient uses of auctions is called price discovery: letting the market tell you what price you can get for what you are selling, and to whom you should sell it to get that price.
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should never forget that markets are human artifacts.
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