Want to learn more about market design? Al Roth has an article, “The Art of Designing Markets,” in the October 2007 edition of the Harvard Business Review. The article is available to subscribers online, or perhaps you can find it at your local bookstore. The introduction:
Traditional economics views markets as simply the confluence of supply and demand. A new field of economics, known as ‘market design,’ recognizes that well-functioning markets depend on detailed rules. …[M]arkets work differently from one another: Doctors aren’t hired the way lawyers, professional baseball players, or new MBAs are. Market designers try to understand these differences and the rules and procedures that make various kinds of markets work well or badly. Their aim is to know the workings and requirements of particular markets well enough to fix them when they’re broken or to build markets from scratch when they’re missing.
The HBR piece covers the same general material that Roth discussed at Google (video), Boston University (video), and the Hahn Lecture at the Royal Economic Society meetings earlier this year (paper). The HBR article is much less technical in nature — very accessible and easy to understand — while the two videos have Roth getting into some of the more technical issues. The Hahn Lecture paper falls between, much more thorough than the HBR, but less technical than the video presentations.