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1、ExperimentsforMarketDesign:LabormarketclearinghousesMarketDesign:Themarketdesign“movement,”asIunderstandit,seeksto:•Understanddesignfeaturesofexistingmarkets–Experimentshelptoisolateandvaryparticularfeatures•Testnewdesignelementsnotyetfoundanywhere–Experim
2、entsgiveustheonlyempiricaldata•Developandhelpimplementpracticalmarketdesigns,fornewmarkets,andtocorrectmarketfailuresinexistingmarkets.–Experimentsplaymultipleroles2Multiplerolesforexperimentsinpracticalmarketdesign•Indiagnosingandunderstandingmarketfailur
3、es,andsuccesses•Indesigningnewmarkets•Incommunicatingresultstopolicymakers3HandbookofExperimentalEconomicsV.2,JohnKagelandAlvinRoth,eds.,inpreparation•MarketDesign–EarlyPlott/Smithe.g.postedpriceversusdoubleauction–publicgoodsexperiments–emissionstrading,–
4、auctions:FCC,eBay,reputationmarkets,procurement,combinatorial–Contractdesign–Matchingmarkets:doctors,lawyers,schools,kidneys4Lessonsfrommarketfailuresandsuccesses•Toachieveefficientoutcomes,marketplacesneedmakemarketssufficiently–Thick•Enoughpotentialtrans
5、actionsavailableatonetime–Uncongested•Enoughtimeforofferstobemade,accepted,rejected…–Incentivecompatible•Safetorevealrelevantpreferences•Somekindsoftransactionsarerepugnant…–Thiscanbeanimportantconstraintonmarketdesign•Experimentsplayacriticalroleinlearnin
6、gandcommunicatingdesignlessons5Someexamples•Medicallabormarkets–NRMPin1995(thickness,congestion,incentives)–Gastroenterologyin2006(thickness,incentives)•Schoolchoicesystems:–NewYorkCityin2003(congestion&incentives)–Bostonin2006(incentives)•Kidneyexchange(t
7、hickness,congestion,incentives)–NewEnglandandOhio(2005)–NationwideU.S.(2010??)6MatchingdoctorstofirstpositionsinU.S.andCanada•Theredesignin1995ofthe–U.S.NationalResidentMatchingProgram(NRMP)(approx.23,000positions,500couples)–CanadianResidentMatchingServic
8、e(CaRMS)(1,400Canadianmedicalgrads,including41couples,1,500positionsin2005)•Theredesignin2005ofthefellowshipmatchesformoreseniorphysicians–TheGastroenterologyfellowshipmatch7Backgroundtoredesignofthemedicalcl