Tuesday, April 23, 2024

Kidney Markets--my debate with Debra Satz (video)

The video of my debate with Debra Satz on kidney markets is now available, see below.  

The question we debated was "Should we experiment with forms of regulated payments to individuals who provide a kidney for others?"  
The audience was asked to vote on that question before we began, and again after we concluded.


Some of my slides  in the video are blurred, because Stanford's Office of General Counsel is concerned about anything that might be construed as a copyright violation  For example, to set the stage, in an early slide I show the cover of Debra's book  Why Some Things Should Not Be for Sale: The Moral Limits of Markets, next to a similar picture of the cover of my book Who Gets What — And Why. The New Economics of Matchmaking and Market Design.  But in the video, the cover of Debra's book has been blurred.

Nevertheless, I think you can get a good idea of what we said, and what a friendly discussion it was.

Monday, April 22, 2024

Plasma donation in the EU: compensated and uncompensated

 Here's a commentary on the EU Parliament's current efforts to ban compensation to plasma donors in the EU, published today.

 Julio J Elias, Nicola Lacetera, Mario Macis, Axel Ockenfels, Alvin E Roth, "Quality and safety for substances of human origins: scientific evidence and the new EU regulations," BMJ Global Health, Volume 9, Issue 4 (21 April, 2024) https://doi.org/10.1136/bmjgh-2024-015122

"Summary box

The new European Union (EU) ‘Regulation on standards of quality and safety for substances of human origin (SoHOs) intended for human application’ is based on a long-standing diffidence towards offering compensation to donors of SoHOs.

We point to recent, growing empirical evidence indicating that carefully designed compensation can increase the supply of SoHOs without negatively affecting quality and safety. We also elaborate arguments that address some of the moral concerns that motivate the aversion to payments.

As member states proceed to adopt the new EU regulation, our article may provide insights on how to achieve both self-sufficiency and safety"


"At least where plasma for fractionation is concerned, the unpaid-donor system has failed to meet demand. Table 1 indicates that in Europe, countries allowing monetary compensation for donors are the only ones achieving self-sufficiency in plasma collection for the production of immunoglobulin. The plasma sector in countries that compensate plasma donors, notably the USA, serves as supplier to many countries experiencing chronic shortages. The USA alone collects about 70% of the world’s plasma supply.10 A combination of a favourable regulatory environment, an extensive collection network and advanced technological infrastructure contributed to establishing the US position.11

Table 1

Plasma self-reliance and models of plasma collection15–19

CountryReliance on domestic supply (% of total national need)Monetary payments allowedCurrent payment amountOther incentives
Austria (2020)100Yes€30–40
Czech Republic (2020)100Yes€30–35
Germany (2020)100Yes€25
Hungary (2020)100Yes€30
Latvia (2018)100Yes€17
Italy (2018)76NoPaid leave of absence from work
Slovenia (2017)54NoPaid leave of absence from work
Belgium (2019)50NoPaid leave of absence from work
France (2020)50No
Netherlands (2020)45No
Slovakia (2018)41No
Denmark (2018)34No
Spain (2020)34No
Portugal (2018)22NoExemption from National Health Service user fees
  • The table shows, for each country, the percentage of plasma needed for immunoglobulin (Ig) production that is collected domestically. The year in parenthesis is the one to which the data on self-reliance refer. The table then reports whether monetary payments are allowed, the current range of payments per donation and any other incentives in use in each country. In countries that allow payments, plasma collectors offer, in addition to monetary compensation for each donation, additional monetary or in-kind rewards, for example, when a donor reaches a certain number of donations (eg, 5, 10,…), or to first-time donors. The figures reported above do not include these additional rewards.

Sunday, April 21, 2024

The Curious Culture of Economic Theory by Ran Spiegler

 Ran Spiegler has new book about the academic culture of the theory part of the Economics profession.  It's open source, so you can sample it online.

The Curious Culture of Economic Theory   by Ran Spiegler

The MIT Press, 2024
ISBN electronic:

Here's what it says on the website:

"An essay collection that insightfully explores the professional culture of contemporary economic theory, highlighting key features of successful economic theory from the last quarter century.

"When is a theoretical result taken seriously enough for economic application? How do theorists actively try to influence this judgment? What determines whether a new theoretical subfield adopts a “pure” or an “applied” style? How do theorists respond to economists' penchant for “rational” explanations of human behavior? These are just some of the questions regarding the professional culture of contemporary economic theory that Ran Spiegler attempts to answer in this incisive essay collection, The Curious Culture of Economic Theory. In exploring these questions, Spiegler addresses the norms that economic theorists apply as they produce, evaluate, and disseminate research.

"Introducing a new genre—a kind of cultural criticism of economic theory—the essays in this unique collection highlight elements of style and rhetoric that characterize classic pieces of economic theory from the last quarter century. For each piece, Spiegler offers a precise yet accessible exposition of modern classics of economic theory while placing them in the broader context of the field's professional culture. Affectionate in its criticism and anthropological in its approach, The Curious Culture of Economic Theory is as valuable a complement to standard textbooks in graduate-level economic theory, game theory, and behavioral economics as it is to the libraries of practicing economic theorists, academic economists, historians of economic thought, and philosophers of economics."

I first sampled Chapter 8, whose first sentence is given below:

Chapter 8: From Competitive Equilibrium to Mechanism Design in Eighteen Months 

"If I had to name one major shift in the sensibilities of economic theorists in the past half century, a prime candidate would be the way we conceptualize markets—from quasi-natural phenomena admired from afar to manmade institutions whose design can be tweaked by economist-engineers."

Saturday, April 20, 2024

Call for papers: special issue on Market Design at Mathematics of Operations Research

 Paul Milgrom and Martin Bichler write:

We are excited to announce that, as an initiative arising from discussions during the fall program, the journal Mathematics of Operations Research will be dedicating a special issue on market design (deadline: Sep 30, 2024). This special issue is co-organized by the INFORMS Section on Auctions and Market Design and aims to showcase cutting-edge research in the field, reflecting the depth and diversity of thought that our program sought to cultivate.

We are seeking contributions that not only push the boundaries of our current understanding but also highlight practical implications and potential applications of market design principles. We believe that your research and insights could greatly enrich this special issue, and we warmly invite you to submit your papers for consideration.

We are looking forward to submissions from program participants and to the opportunity to highlight the exceptional work emerging from our community.

Friday, April 19, 2024

Sports and celebrity (salary and income)

 Basketball superstar Caitlin Clark recently went pro for a salary of $76,535.  What's going on?  The LA Times has the story of rags and riches...

Caitlin Clark is worth millions. Why will she only make $76,535 in base salary as a WNBA rookie?  By Chuck Schilken

"Clark, the Iowa phenomenon who set the NCAA career basketball scoring record and helped the women’s March Madness tournament reach all-time highs in TV ratings, was the No. 1 overall pick for the Indiana Fever in Monday’s WNBA draft.

"Her jersey sales are already through the roof. The league scheduled the Fever for 36 nationally televised games, more than any other team this season, several days before Clark officially became a member of the team. Likewise, tickets for opposing teams’ home games against Indiana saw a spike in interest (and price) long before draft night.

Clark will make $76,535 in base salary this year as a WNBA rookie, part of a four-year contract worth $338,056.


"Those salaries are the maximum allowed for rookies, as laid out in the most recent collective bargaining agreement between the WNBA and its players association


"As the WNBA pointed out in a statement emailed to The Times on Tuesday night, however, Clark will have the opportunity to make more money on top of her base salary.

Caitlin Clark stands to make a half million dollars or more in WNBA earnings this coming season,” the statement read, “in addition to what she will receive through endorsements and other partnerships, which has been reported to already exceed $3 million.


"In addition to the individual endorsement deals she has already secured, Clark will undoubtedly will have a stream of other lucrative opportunities come her way. BIG3 co-founder Ice Cube has offered Clark $5 million to become the first female player in his three-on-three basketball league.

"Still, it might come as a bit of a shock to learn how relatively little Clark and other star WNBA rookies will make in base salary, especially compared with their counterparts in other leagues. Like Clark, Victor Wembanyama was seen as a generational talent when he was selected No. 1 overall by the San Antonio Spurs in the 2023 draft. His four-year rookie contract is worth $55.2 million."



 How Nike Won the Battle for Caitlin Clark  By Rachel Bachman, WSJ, April 19, 2024

"When it came to Clark, Nike looked even further into the future. The duration of the proposed contract, eight years, suggests that the brand sees not only long-term stardom potential, but truly global appeal. The next eight years, Nike executives reasoned, would give Clark a chance to represent the U.S. at three Olympic Games—this summer in Paris, 2028 in Los Angeles, and 2032 in Brisbane, Australia. (The U.S. roster for Paris won’t be announced until June or July.)

"Nike’s initial offer of $3.5 million a year, though an eye-popping number, didn’t initially come with a signature shoe. One possibility floated was that Clark would instead become the female face of the Kobe Bryant line, which relaunched in August 2023 to great fanfare.

"In its final offer to Clark, however, Nike upped its offer to include a signature shoe. That would give her the most lucrative and attractive shoe deal in women’s basketball—and yet another record for her collection."

Thursday, April 18, 2024

Top Trading Cycles (TTC) and the 50th anniversary of the Journal of Mathematical Economics

 This year marks the 50th anniversary of the Journal of Mathematical Economics, and also of the Top Trading Cycles (TTC) algorithm that was introduced in Volume 1, number 1 of the journal, in the paper by

Shapley, Lloyd, and Herbert Scarf. "On cores and indivisibility." Journal of mathematical economics 1, no. 1 (1974): 23-37. 

TTC was further analyzed in 

Roth, Alvin E., and Andrew Postlewaite. "Weak versus strong domination in a market with indivisible goods." Journal of Mathematical Economics 4, no. 2 (1977): 131-137.

Now the JME is assembling a 50th anniversary collection of papers surveying some of the resulting literatures, with some papers posted online ahead of publication. Here's what they had as of yesterday, including an article on Top Trading Cycles, by Morrill and Roth, and one on Housing markets since Shapley and Scarf, by Afacan, Hu, and Li:

JME’s 50th Anniversary Literature  Edited by Andres Carvajal and Felix Kübler

  1. Top trading cycles

    In Press, Journal Pre-proof, Available online 16 April 2024
    Article 102984
    View PDF
  2. Bubble economics

    April 2024
    Article 102944
    View PDF
  3. Stable outcomes in simple cooperative games

    April 2024
    Article 102960
    View PDF
  4. Fifty years of mathematical growth theory: Classical topics and new trends

    April 2024
    Article 102966
    View PDF
  5. Housing markets since Shapley and Scarf

    April 2024
    Article 102967
    View PDF


At least one of the papers in the (virtual) special issue is already published, I gather that some will be in the June issue:

Monday, March 4, 2024

Wednesday, April 17, 2024

Signaling in medical residency applications

 We're starting to see descriptive studies of how signals are being used in the labor market for new doctors.  Each medical specialty has chosen to adapt the kinds of signals used in Economics in its own way, with some specialties using only a handful of signals and others eliciting as many as 30.

Here are two papers from a recent issue of Academic Medicine.

Impact of Applicants’ Characteristics and Geographic Connections to Residency Programs on Preference Signaling Outcomes in the Match, by Benjamin, William J. MPH; Lenze, Nicholas R. MD, MPH; Bohm, Lauren A. MD; Thorne, Marc C. MD, MPH; Abraham, Reeni MD; Sepdham, Dan MD; Mihalic, Angela P. MD; Kupfer, Robbi A. MD,  Academic Medicine 99(4):p 437-444, April 2024. | DOI: 10.1097/ACM.0000000000005551


Purpose : To assess the impact of applicant and residency program characteristics on preference signaling outcomes in the Match during the first 2 years of implementation across 6 specialties.

Method : Data were obtained from the Texas Seeking Transparency in Application to Residency survey for applicants applying into otolaryngology during the 2020–2021 and 2021–2022 application cycles and into dermatology, internal medicine (categorical and preliminary year), general surgery, and urology during the 2021–2022 application cycle. The primary outcome was signal yield, defined as the number of interviews at signaled programs divided by the total number of signals sent. Associations with applicant-reported characteristics and geographic connections to residency programs were assessed using Wilcoxon rank sum testing, Spearman’s rank correlation testing, and ordinary least squares regression.

Results : 1,749 applicants with preference signaling data were included from internal medicine (n = 884), general surgery (n = 291), otolaryngology (n = 217), dermatology (n = 147), urology (n = 124), and internal medicine preliminary year (n = 86). On average 60.9% (standard deviation 32.3%) of signals resulted in an interview (signal yield). There was a stepwise increase in signal yield with the percentage of signals sent to programs with a geographic connection (57.3% for no signals vs. 68.9% for 5 signals, P < .01). Signal yield was positively associated with applicant characteristics, such as United States Medical Licensing Exam Step 1 and 2 scores, honors society membership, and number of publications (P < .01). Applicants reporting a lower class rank quartile were significantly more likely to have a higher percentage of their interviews come from signaled programs (P < .01).

Conclusions: Signal yield is significantly associated with geographic connections to residency programs and applicant competitiveness based on traditional metrics. These findings can inform applicants, programs, and specialties as preference signaling grows."

And here are the introductory paragraphs:

"The rising number of residency applications submitted per applicant has led to concerns that programs will not be able to adequately perform a holistic review of all applications and will instead rely on easily reviewed metrics, such as United States Medical Licensing Exam (USMLE) scores, class rank, and medical school reputation.1,2 In addition, COVID-19–related changes to the residency application process, such as the introduction of virtual interviewing and a cap on the number of away rotations medical students can complete, have limited applicants’ ability to informally express their interest in programs.3 Further, there is evidence that, while applying to the maximum number of programs is advantageous at the individual level, it leads to poorer overall results when all applicants follow this practice.2 To address this issue, new systems have been proposed, including personalized application paragraphs,4 program-specific messages,5 and preference signals.4,6,7

"Otolaryngology implemented a preference signaling system in 2021, which was based on theory developed by the American Economic Association (AEA) in 2006. The AEA used a preference signaling system for job market applicants, whereby applicants were allowed to express special interest in particular employers in their applications.8 Results from the AEA program highlighted that preference signals were beneficial to both candidates and employers in a labor market where employers are unable to provide full attention to every application they receive.9 Building off previous economic work, a computer simulation study run on 2014 otolaryngology Match data found that the number of interview invitations improved when applicants provided preferences on their Electronic Residency Application Service application; this result would have benefitted both programs and applicants.2

"Based on this research, the Otolaryngology Program Directors Association formally implemented a preference signaling system during the 2020–2021 application cycle in which applicants were granted 5 “signals” to send to residency programs prior to interviews indicating their strong interest in that program. Each program then received a list of the applicants who had sent them a signal.6,10,11 Data from the 2021 otolaryngology Match were notable for significantly increased interview rates at signaled programs across all levels of applicant competitiveness.10,12 Furthermore, the majority of program directors and applicants strongly supported the continuation of preference signaling.10,11 During the 2021–2022 application cycle, preference signaling pilot programs were implemented in 5 additional specialties: dermatology, internal medicine (categorical), internal medicine preliminary year, surgery (categorical), and urology, with each specialty using 5 signals per applicant, except dermatology, which used 3 signals"


The Relationship Between Program and Applicant Characteristics With Applicant Program Signals in the 2022 Residency Recruitment Cycle: Findings From 3 Specialties, by LaFemina, Jennifer MD; Rosman, Ilana S. MD; Wallach, Sara L. MD; Wise, Paul E. MD; Smink, Douglas S. MD, MPH; Fletcher, Laura PhD, Academic Medicine 99(4):p 430-436, April 2024. | DOI: 10.1097/ACM.0000000000005586


Purpose: Continuing increases in application volume have driven a national dialogue to reform the residency recruitment process. Program signaling allows applicants to express interest in a program at the preinterview stage with the goal of helping programs identify applicants with more genuine interest in their programs. This study explored the relationship between program signals and program and applicant characteristics.

Method: Participating dermatology, general surgery, and categorical internal medicine (IM) programs and applicants of the 2022 supplemental ERAS application (SuppApp) were included. Data from the SuppApp, the MyERAS Application for Residency Applicants (MyERAS), and the 2020 GME Track Survey were used. Cohen’s h was used to determine effect size, and chi-squared was used to determine statistical significance.

Results:There was an uneven distribution of signals to programs, with 25% of programs receiving about half of the signals across all 3 specialties. Programs with larger numbers of both residents and applicants received greater numbers of program signals relative to their program density, although this effect was small (h < 0.50, P < .001). No meaningful differences were seen across genders for any specialty. Only Hispanic applicants in IM sent a higher proportion of signals to programs with more underrepresented in medicine residents than White only applicants (40% vs 26%, h = 0.30, P < .001). Across all specialties, there was a small-to-moderate effect for international medical graduate (IMG) applicants sending a larger proportion of signals to programs with more IMG residents (h < 0.80, P < .001).

Conclusions: This first-year pilot study (i.e., SuppApp) provided initial evidence that supports the feasibility and fairness of program signals in residency selection. As program signals become more common across specialties, future research should continue to evaluate trends in where applicants send signals, and possible relationships between program and application characteristics."

"IMG applicants were more likely to signal programs with a greater proportion of IMG residents. The effect was small in dermatology and increased to moderate in GS and large in IM. In the NRMP’s 2022 Main Residency Match, 11 IMGs (U.S. and non-U.S.) matched into postgraduate year 2 dermatology, representing 2% of positions. This compares to the 10% and 38% IMG Match rate into GS and IM, respectively.21 While at this time, correlation of signal distribution and the likelihood of successfully matching is not available, these findings suggest that in general, IMG applicants sent more signals to programs they knew to be “IMG friendly” (i.e., more likely to accept IMGs), which they could easily identify with tools such as the Residency Explorer Tool22 and the Residency Programs List.23 However, if IMGs continue to send more signals to programs with already higher proportions of IMG residents, this may maintain the status quo or even further restrict the IMG applicant pool all programs are willing to consider during their resident selection process because programs with fewer IMGs will continue to receive a lower proportion of signals from IMG applicants. This could ultimately negatively affect diversity across programs"