Market design at Harvard Business School

Here's the announcement of a new HBS course on market design:

Making Markets

Course Number 1764

Professor Thomas R. Eisenmann
Associate Professor Scott Duke Kominers
Spring; Q3Q4; 3 credits
24 sessions
Paper

Markets are everywhere - and where they’re not, you can build them!

Career Focus

Over the past twenty years, entrepreneurs have created and captured enormous value by launching new marketplaces. Examples include Airbnb, Alibaba, ClassPass, Craigslist, eBay, eHarmony, Etsy, Gerson Lehrman Group, Google, IEX Group, Lending Club, Kickstarter, OpenTable, Rakuten, Uber, Upwork, and many more.

Making Markets (M²) is intended for students who want to manage in marketplace environments and remedy market failures by building new platforms and marketplaces from scratch or by redesigning existing ones - or who want to advise or invest in entrepreneurs who pursue such opportunities.

Educational Objectives

Students will learn how to identify market failures and determine when those failures create opportunities to launch or redesign marketplaces.

First, we will explore how markets function and what makes them fail. Next, we will examine how effective marketplace design-or redesign-can address market failures and improve efficiency, liquidity, and fairness. Then, we will take the entrepreneur’s perspective, studying the key barriers to organizing new marketplaces and devising strategies for overcoming them. Along the way, we will pay special attention to settings in which marketplaces create more value for transaction partners than relying only on unmediated exchanges. As we will see, marketplace design can often “square the circle,” solving seemingly intractable problems simply by reducing transaction costs or barriers to entry.

Case contexts will range from ultra-local (e.g., the HBS EC course lottery) to truly global (e.g., container shipping); will examine private and public/social enterprise settings; will profile both online and offline marketplaces; and will span all stages of marketplace launch and development.

Course Content

Through case studies, simulations, and the occasional interactive lecture, M² will examine the design, launch, and management of marketplaces and marketplace platforms. Core lessons include:

• The Structure and Purposes of Markets: Markets create value by enabling parties to execute mutually beneficial transactions - exchanging goods, say, or sharing ideas. They are everywhere that transacting parties face incentives - from classic contexts like financial or product markets to dating, recruiting, and the sharing economy.
  Some markets are completely unstructured, but most are subject to at least some rules that shape participation. In this course, we will focus in particular on markets that are organized through marketplaces that combine rules for participation with infrastructure to facilitate interactions and transactions.
• Common Sources of Market Failure: In many markets, institutional frictions combine with incentives to produce suboptimal outcomes - socially wasteful transactions occur, or productive ones do not. When such market failures occur, entrepreneurial opportunities arise: reshaping the market to improve efficiency creates value that can be captured(!).
  To understand how to fix markets, however, we must first understand how and why market failures occur. The course will classify different types of market failures, and highlight entrepreneurial responses to each.
• Strategies for Launching and Managing Marketplaces: When launching a marketplace or other market intervention, it is essential to mobilize a critical mass of market participants so that there is enough liquidity for valuable transactions to occur. Once running, a marketplace must maintain balance between its supply and demand sides, or else participants may leave to transact elsewhere. Yet at the same time, marketplaces must avoid crowding that makes it hard for participants to find high-value transaction partners.
  The course will provide strategies for promoting participation and trust in marketplaces, especially early on. Then, we will learn techniques for growing marketplaces, and combating the problems that marketplaces face at scale, such as congestion, “unraveling” (e.g., when recruiters pressure candidates with early and exploding offers), and the risk of disintermediation.
• Types of Marketplace Mechanisms: Markets work in many different ways. Some compel participants to seek out their own transaction partners; others use centralized transaction discovery and execution systems like auctions and recommendation algorithms. The mechanisms that a marketplace uses to identify and process transactions can be the difference between success and failure.
  Choosing among marketplace mechanisms requires careful attention to market participants’ needs and transaction attributes. The course will provide guidelines for adopting mechanisms best suited for different market contexts.

School choice in Indianapolis: podcast of my talk at the Economic Club of Indianapolis

Here's a link to the broadcast of my talk on radio WYFI in Indianapolis, on markets, marketplaces, Who Gets What, and school choice with unified enrollment which is coming to Indianapolis next year.

Economic Club of Indiana / Dr. Alvin Roth

Match Up 2017: April 20-21 at Microsoft Research New England

MATCH-UP 2017, the fourth workshop in the series of interdisciplinary and international workshops on matching under preferences, will take place April 20-21, 2017.

Venue:Microsoft Research New England Cambridge, MA 02142

	DAY 1
8:00 A.M.	Breakfast
8.45 A.M.	Invited Talk 1 —Estelle Cantillon, Université libre de Bruxelles The efficiency – stability tradeoff in school choice: Lessons for market design Abstract: A well-known result for the school choice problem is that ex-post efficiency and stability may not be compatible. In the field, that trade-off is sometimes small, sometimes big.  This talk will summarize existing and new results on the drivers of this trade-off and derive the implications for the design of priorities and tie-breaking rules.
9.30 A.M.	Session 1
10.30 A.M.	Break
10.50 A.M.	Session 2
12.30 P.M.	Lunch
1:00 P.M.	Outlook Talk 1 – Al Roth, Stanford Frontiers of Kidney Exchange Abstract: Kidney exchange is different from many market design efforts I’ve been involved in, because it affects the everyday conduct of transplant centers, so we’re constantly adapting to their big strategy sets…(in contrast to e.g. annual labor markets or school choice which don’t affect the daily conduct of residency programs and schools …)The early design challenges in kidney exchange mostly involved dealing with congestion (and the solutions involved long chains, standard acquisition charges, and attempts to better elicit surgeons’ preferences over kidneys).The current challenges to kidney exchange involve creating more thickness in the markets, and I’ll touch on several new initiatives: 1. Frequent flier programs to encourage transplant centers to enroll more of their easy to match pairs; 2. Global kidney exchange; 3. Information deserts: populations of Americans who don’t get transplants; 4. Deceased donor initiated chains ; a. Increasing deceased donation: military share, priority in Israel
2:00 P.M.	Session 3
3.40 P.M.	Break
4:00 P.M.	Session 4
5:00 P.M.	Invited Talk 2 – Aaron Roth, UPENN Approximately Stable, School Optimal, and Student-Truthful Many-to-One Matchings (via Differential Privacy) Abstract: In this talk, we will walk through a case study of how techniques developed to design “stable” algorithms can be brought to bear to design asymptotically dominant strategy truthful mechanisms in large markets, without the need to make any assumptions about the structure of individual preferences. Specifically, we will consider the many-to-one matching problem, and see a mechanism for computing school optimal stable matchings, that makes truthful reporting an approximately dominant strategy for the student side of the market. The approximation parameter becomes perfect at a polynomial rate as the number of students grows large, and the analysis holds even for worst-case preferences for both students and schools. Joint work with: Sampath Kannan, Jamie Morgenstern, and Zhiwei Steven Wu.
5.45 P.M.	Break
6:00 P.M.	Poster Lightning Talks
6.30 P.M.	Reception and Poster Session
8:00 P.M.	END
	DAY 2
8:00 A.M.	Breakfast
8.45 A.M.	Invited Talk 3 — Michael Ostrovsky, Stanford Matching under preferences: beyond the two-sided case Abstract: I will present an overview of several recent papers showing that most of the key results of matching theory generalize naturally to a much richer setting: trading networks. These networks do not need to be two-sided, and agents do not have to be grouped into classes (“firms”, “workers”, and so on). What is essential for the generalization is that the bilateral contracts representing relationships in the network have a direction (e.g., one agent is the seller and the other is the buyer), and that agents’ preferences satisfy a suitably adapted substitutability notion. For this setting, for the cases of discrete and continuous sets of possible contracts, I will discuss the existence of stable outcomes, the lattice structure of the sets of stable outcomes, the relationship between various solution concepts (stability, core, competitive equilibrium, etc.), and other results familiar from the literature on two-sided markets.
9.30 A.M.	Session 5
10.30 A.M.	Break
10.50 A.M.	Session 6
12.30 P.M.	Lunch
1:00 P.M.	Lunch w/Outlook Talk 2 — David Manlove, University of Glasgow Selected Algorithmic Open Problems in Matching Under Preferences Abstract: The research community working on matching problems involving preferences has grown in recent years, but even so, plenty of interesting open problems still exist, many with large-scale practical applications.  In this talk I will outline some of these open problems that are of an algorithmic flavour, thus giving an outlook on some of the research challenges in matching under preferences that the computer science community might seek to tackle over the next decade.
2:00 P.M.	Session 7
	Making it Safe to Use Centralized Markets: Epsilon - Dominant Individual Rationality and Applications to Market Design Speakers: Ben Roth and Ran Shorrer Abstract: A critical, yet under-appreciated feature of market design is that centralized markets operate within a broader context; often market designers cannot force participants to join a centralized market. Well-designed centralized markets must induce participants to join voluntarily, in spite of pre-existing decentralized institutions they may already be using. We take the view that centralizing a market is akin to designing a mechanism to which people may voluntarily sign away their decision rights. We study the ways in which market designers can provide robust incentives that guarantee agents will participate in a centralized market. Our first result is negative and derives from adverse selection concerns. Near any game with at least one pure strategy equilibrium, we prove there is another game in which no mechanism can eliminate the equilibrium of the original game. In light of this result we offer a new desideratum for mechanism and market design, which we term epsilon-dominant individual rationality. After noting its robustness, we establish two positive results about centralizing large markets. The first offers a novel justification for stable matching mechanisms and an insight to guide their design to achieve epsilon-dominant individual rationality. Our second result demonstrates that in large games, any mechanism with the property that every player wants to use it conditional on sufficiently many others using it as well can be modified to satisfy epsilon-dominant individual rationality while preserving its behavior conditional on sufficient participation. The modification relies on a class of mechanisms we refer to as random threshold mechanisms and resembles insights from the differential privacy literature.
3.40 P.M.	Break
4:00 P.M.	Session 8
5.20 P.M.	Break
5.30 P.M.	Invited Talk 4 — Marek Pycia, UCLA Invariance and Matching Market Outcomes Abstract: The empirical studies of school choice provide evidence that standard measures of admission outcomes are the same for many Pareto efficient mechanisms that determine the market allocation based on ordinal rankings of individual outcomes. The paper shows that two factors drive this intriguing puzzle: market size and the invariance properties of the measures for which the regularity has been documented. In addition, the talk will explore the consequences of these findings: the usefulness of non-invariant outcome measures and of mechanisms that elicit preference intensities.
6.15 P.M.	Closing Remarks
6.30 P.M.	END

National Kidney Foundation: 2017 Spring Clinical Meetings (SCM17) in Orlando

Here's the Welcome letter from the 2017 Program Chair, Dr. Dena Rifkin

"Be sure to join us on Wednesday April 19th for the special Keynote presentation by 2012 Nobel Laureate Alvin Roth, PhD, whose work led to the development of kidney donor-recipient matching algorithms.  Other individuals highlighted on this year's program include Shaul G. Massry Distinguished Lecture Award Winner Dr. Raymond Townsend who will be giving a presentation on “The Ailing Kidneys Under Pressure – and It’s Not Just Systolic” and Dr. Paul Palevsky’s plenary session on “We Don’t Have to Fail at Acute Renal Failure: A Multidisciplinary Approach to Quality Improvement.”

My talk will be on "Kidney Exchange: Recent History and Future Opportunities"

Assisted dying appeal to be heard in Britain

The Guardian has the story
Assisted dying

Terminally ill former lecturer wins right to fight assisted dying ban
Appeal court reverses high court ruling in case of Noel Conway, who has motor neurone disease and seeks judicial review

"In their judgment, Lord Justice McFarlane and Lord Justice Beatson said: “It is arguable that the evidence demonstrates that a mechanism of assisted dying can be devised for those in Mr Conway’s narrowly defined group that is practical so as to address one of the unanswered questions in the [earlier Nicklinson right to die case].”

Supported by the organisation Dignity in Dying, Conway has instructed lawyers to seek permission for a judicial review of the ban on assisted dying, which he says prevents him ending his own life without protracted pain. Assisted dying is prohibited by section 2(1) of the Suicide Act 1961 and voluntary euthanasia is considered murder under English and Welsh law."

A non-directed kidney donor writes eloquently about his experience

Dylan Matthews is eloquent about his decision to give a kidney to a stranger, and explicit about his experience, including post-surgical pain and his recovery. He's well worth reading.

Vox has the story: Why I gave my kidney to a stranger — and why you should consider doing it too

My colleague, the philosopher Debra Satz, points out to me that one of the altruistic donors whose experience motivated Matthews was her student. Philosophy is powerful.

Doctors harvesting organs from Canadian patients who underwent medically assisted death

The National Post has the story:
Doctors harvesting organs from Canadian patients who underwent medically assisted death

"Doctors have already harvested organs from dozens of Canadians who underwent medically assisted death, a practice supporters say expands the pool of desperately needed organs, but ethicists worry could make it harder for euthanasia patients to voice a last-minute change of heart.

In Ontario, 26 people who died by lethal injection have donated tissue or organs since the federal law decriminalizing medical assistance in dying, or MAID, came into effect last June, according to information obtained by the Post. A total of 338 have died by medical assistance in the province.

Most of the 26 were tissue donors, which usually involves eyes, skin, heart valves, bones and tendons.

Bioethicists and transplant experts say people who qualify for assisted dying deserve to be offered the chance to donate their organs. The gesture could bring a profound sense of psychological comfort, they say, provided the request for assisted death and the decision to donate are kept entirely separate."

Workshop on Mechanism Design for Social Good June 26, 2017 at MIT in Cambridge, MA

Social good, what's not to like?
Here's the announcement:
Workshop on Mechanism Design for Social Good
June 26, 2017 at MIT in Cambridge,

"The first workshop on Mechanism Design for Social Good (MD4SG '17) will be held in conjunction with the 18th ACM Conference on Economics and Computation (EC '17) at MIT in Cambridge, MA on June 26, 2017, and will feature invited speakers, paper presentations, and a panel discussion with researchers in the EconCS community."

A transplant center in India has done 300 kidney exchange transplants

Here's the article, whose first author is Dr. Vivek Kute, of the Faculty of Nephrology and Transplantation, Institute of Kidney Diseases and Research Center and Dr. H L Trivedi Institute of Transplantation Sciences ,
(IKDRC-ITS) Ahmedabad , India

Transpl Int. 2017 Mar 20. doi: 10.1111/tri.12956. [Epub ahead of print]

Impact of Single-Centre Kidney Paired Donation Transplantation to Increase the Donor Pool in India.

Kute VB1, Patel HV1, Shah PR1, Modi PR2, Shah VR3, Rizvi SJ2, Pal BC2, Shah PS1, Modi MP3, Butala BP3, Wakhare PS1, Varyani UT1, Shinde SG1, Ghodela VA1, Kasat GS1, Patil MV1, Patel JC1, Kumar DP1, Trivedi VB4, Patel MH4, Trivedi HL1.

Author information

Abstract

In a living donor kidney transplantation (LDKT) dominated transplant programme, kidney paired donation (KPD) may be a cost-effective and valid alternative strategy to increase LDKT in countries with limited resources where deceased donation kidney transplantation (DDKT) is in the initial stages. Here, we report our experience of 300 single-centre KPD transplantations to increase LDKT in India. Between January 2000 and July 2016, 3616 LDKT and 561 DDKT were performed at our transplantation centre, 300 (8.3%) using KPD. The reasons for joining KPD among transplanted patients were ABO incompatibility (n=222), positive cross match (n=59) and better matching (n=19). A total of 124 two-way (n=248), 14 three-way (n=42), one 4-way (n=4) and one 6-way exchange (n=6) yielded 300 KPD transplants. Death-censored graft and patient survival were 96% (n=288) and 83.3% (n=250), respectively. The mean serum creatinine was 1.3 mg/dl at a follow-up of 3±3 years. We credit the success of our KPD programme to maintaining a registry of incompatible pairs, counselling on KPD, a high-volume LDKT programme and teamwork. KPD is legal, cost effective and rapidly growing for facilitating LDKT with incompatible donors. This study provides large-scale evidence for the expansion of single-centre LDKT via KPD when national programmes do not exist. This article is protected by copyright. All rights reserved.

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Here's a related recent article by Dr. Kute:

World J Transplant. 2017 Feb 24;7(1):64-69. doi: 10.5500/wjt.v7.i1.64.

International kidney paired donation transplantations to increase kidney transplant of O group and highly sensitized patient: First report from India.

Kute VB1, Patel HV1, Shah PR1, Modi PR1, Shah VR1, Rizvi SJ1, Pal BC1, Shah PS1, Wakhare PS1, Shinde SG1, Ghodela VA1, Varyani UT1, Patel MH1, Trivedi VB1, Trivedi HL1.

Author information

Abstract

AIM:

To report the first international living related two way kidney paired donation (KPD) transplantation from India which occurred on 17th February 2015 after legal permission from authorization committee.

METHODS:

Donor recipient pairs were from Portugal and India who were highly sensitized and ABO incompatible with their spouse respectively. The two donor recipient pairs had negative lymphocyte cross-matching, flow cross-match and donor specific antibody in two way kidney exchange with the intended KPD donor. Local KPD options were fully explored for Indian patient prior to embarking on international KPD.

RESULTS:

Both pairs underwent simultaneous uneventful kidney transplant surgeries and creatinine was 1 mg/dL on tacrolimus based immunosuppression at 11 mo follow up. The uniqueness of these transplantations was that they are first international KPD transplantations in our center.

CONCLUSION:

International KPD will increases quality and quantity of living donor kidney transplantation. This could be an important step to solving the kidney shortage with additional benefit of reduced costs, improved quality and increased access for difficult to match incompatible pairs like O blood group patient with non-O donor and sensitized patient. To the best of our knowledge this is first international KPD transplantation from India.