Saturday, October 1, 2016

The Econometrics of Matching Models by Pierre-André Chiappori and Bernard Salanié in the JEL

The Econometrics of Matching Models
Pierre-André Chiappori and Bernard Salanié
Journal of Economic Literature 2016, 54(3), 832–861

Abstract: Many questions in economics can be fruitfully analyzed in the framework of matching models. Until recently, empirical work has lagged far behind theory in this area. This review reports on recent developments that have considerably expanded the range of matching models that can be taken to the data. A leading theme is that in such two-sided markets, knowing the observable characteristics of partners alone is not enough to credibly identify the relevant parameters. A combination of richer data and robust, theory-driven restrictions is required. We illustrate this on leading applications.

Here is the opening paragraph:
"In October 2012, the Nobel prize was attributed to Al Roth and Lloyd Shapley
for their work on matching. Both the seminal Gale and Shapley (1962) paper and most of Roth’s work were concerned with allocation mechanisms when prices or other transfers cannot be used—what we will call nontransferable utility (NTU) in this survey. Gale and Shapley used college admissions, marriage, and roommate assignments as examples; Roth’s fundamental work in market design has led to major improvements in the National Resident Matching Program (Roth and Peranson 1999) and to the creation of a mechanism for kidney exchange (Roth, Sönmez, and Ünver 2004). While these are important economic applications, matching problems are much more pervasive. Market and nonmarket mechanisms such as auctions match agents with goods and buyers with sellers; agents match to each other in production teams, and production tasks are matched with workers; and in international trade, countries are matched with goods or varieties. Yet while the basic theory of matching was in place forty years ago, only recently has there been an explosion of empirical work in this area. Several developments have concurred to bring it to the attention of applied researchers."

Friday, September 30, 2016

A von Neumann medal in the shape of a saddle point

It's a little hard to see, but the medal forms a saddle point: the intersection of the two lines is a maximum in the horizontal direction and a minimum in the vertical direction...  It had been a long time since I thought of equilibrium that way, but it is from von Neumann's first game theory paper, on two person zero sum games and the minimax theorem.

It is from my trip to Hungary in early September. You can read about it in Hungarian...

Nobel-díjas közgazdász, Alvin E. Roth kapta idén a Neumann János-díjat

Piaci megoldással osztaná el a migránsokat a Nobel-díjas közgazdász

Nobel-díjas közgazdász oldhatja meg a menekültproblémát

Hungarian radio: (interview in Hungarian voice-over)
A pénz sem old meg mindent - így látja a Nobel-díjas, InfoRádió / Czwick Dávid

Isten teremtette a búzát. És az árutőzsdét? (a newspaper interview in Hungarian)
Google translate: God created the wheat. And the commodities market?

Thursday, September 29, 2016

It looks like paying donors of bone marrow/ blood stem cells will remain illegal...

The long story of whether some forms of blood stem cell (marrow) donation may be compensated seems to be coming to an end, back where it began.  Here's the new HHS/HRSA regulation, saying that whether as marrow or in the blood stream, these are considered organs under the National Organ Transplant Act, so no valuable consideration can be given...

View EO 12866 MeetingsPrinter-Friendly Version     Download RIN Data in XML

HHS/HRSARIN: 0906-AB02Publication ID: Spring 2016 
Title: Definition of Human Organ Under Section 301 of the National Organ Transplant Act of 1984 
Abstract:This final rule clarifies that peripheral blood stem cells are included in the definition of bone marrow under section 301 of the National Organ Transplantation Act of 1984, as amended and codified in 42 U.S.C. 274e.
Agency: Department of Health and Human Services(HHS) Priority: Info./Admin./Other 
RIN Status: Previously published in the Unified AgendaAgenda Stage of Rulemaking: Final Rule Stage 
Major: No Unfunded Mandates: No 
CFR Citation: Not Yet Determined     (To search for a specific CFR, visit the Code of Federal Regulations.)
Legal Authority: Pub. L. 109-129    Stem Cell Therapeutic and Research Act of 2005, as amended in 2010 by Pub. L. 111-264   
Legal Deadline:  None
ActionDateFR Cite
NPRM 10/02/2013 78 FR 60810   
NPRM Comment Period End 12/02/2013 
Final Rule 11/00/2016 
Regulatory Flexibility Analysis Required: No Government Levels Affected: Undetermined 
Small Entities Affected: No Federalism: No 
Included in the Regulatory Plan: No 
RIN Data Printed in the FR: No 
Agency Contact:
Dr. James Bowman
Medical Director, Division of Transplantation
Department of Health and Human Services
Health Resources and Services Administration
5600 Fishers Lane, Room 12C-06,
Rockville, MD 20857
Phone:301 443-4861 

HT: Kim Krawiec

Wednesday, September 28, 2016

Is vote swapping related to vote selling the way kidney exchange is related to kidney sales? (a blog post by Scott Aaronson on vote swapping)

Here's a blog post from Scot Aaronson's blog "Shtetl Optimized". He points out that although vote trading is illegal, vote swapping seems not to be. (Apparently it's the money that matters, as in kidney exchange versus kidney sales...)

Here are the critical paragraphs in that connection from his post:
"On August 6, 2007, the Ninth Circuit Court of Appeals finally ruled on a case, Porter v. Bowen, stemming from the California attorney general’s shutdown of  Their ruling, which is worth reading in full, was unequivocal.
Vote-swapping, it said, is protected by the First Amendment, which state election laws can’t supersede.  It is fundamentally different from buying or selling votes."

Here's the whole post, together with some interesting updates added later.

The Ninth Circuit ruled that vote-swapping is legal. Let’s use it to stop Trump.

"Updates: Commenter JT informs me that there’s already a vote-swapping site available:  (I particularly like their motto: “Everybody wins.  Except Trump.”)  I still think there’s a need for more sites, particularly ones that would interface with Facebook, but this is a great beginning.  I’ve signed up for it myself.
Also, Toby Ord, a philosopher I know at Oxford, points me to a neat academic paper he wrote that analyzes vote-swapping as an example of “moral trade,” and that mentions the Porter v. Bowendecision holding vote-swapping to be legal in the US."

Here are two passages from the Ninth Circuit opinion that I found particularly relevant.
The first says that operating vote swapping sites might be protected political speech:

"On the merits, we hold that Jones violated Appellants’ First Amendment rights. The websites’ vote-swapping mechanisms as well as the communication and vote swaps they enabled were constitutionally protected. Although California certainly has valid interests in preventing election fraud and corruption, and perhaps in avoiding the subversion of the Electoral College, these interests did not justify the complete disabling of the vote-swapping mechanisms."

The second addresses the issue of "corruption":
"Corruption. Beginning with the State’s anticorruption interest, we reiterate that we construe this interest to encompass only the prevention of illicit financial transactions such as the buying of votes or the contribution of large sums of money to legislators in exchange for political support. See WRTL, 127 S. Ct. at 2676 (Scalia, J., concurring in part and concurring in the judgment); NCPAC, 470 U.S. at 497; Buckley, 424 U.S. at 26-27. So defined, this interest was not advanced by the threatened prosecution of the owners of and The websites did not encourage the trading of votes for money, or indeed for anything other than other votes. actually included a notation that “It is illegal to pay someone to vote on your behalf, or even get paid to vote yourself. Stay away from the money. Just vote” (emphasis in original). And there is no evidence in the record, nor has the Secretary argued, that any website users ever misused the voteswapping mechanisms by offering or accepting money for their votes. "

HT: Nicole Immorlica

Tuesday, September 27, 2016

National Living Organ Donor Assistance Center (NLDAC)

I've recently joined the advisory board of the National Living Organ Donor Assistance Center (NLDAC), which gives certain forms of financial assistance--mostly travel assistance--to living organ donors.  I expect to learn more about what they do, and can do, in the months to come.

Here's a page outlining how to apply for travel assistance.

And here's a paper describing its history and experience:
Development of the National Living Donor Assistance Center: reducing financial disincentives to living organ donation, by
Patricia H. Warren, RN, CPTC, Kimberly A. Gifford, MBA, Barry A. Hong, PhD, Robert M. Merion, MD, and Akinlolu O. Ojo, MD, PhD, MBA

Abstract: Over the years, the transplant community has worked to advance the care of living organ donors; however, barriers remain, including the nonmedical expenses incurred by living donors. A new center, funded by a grant from the Health Resources and Services Administration (HRSA), was established to operate a nationwide system to remove these financial disincentives. The HRSA grant was awarded to an academic institution and the daily operations are managed by a transplant professional society. Expenses are reimbursed prospectively for financially needy living donors. Combining the legislative authority and economic resources of the federal government, the research experience of an academic institution, and the management know-how of a professional society has proven to be successful. To date, the center has received 3918 applications submitted by 199 different transplant centers and receives about 80 applications per month. On average, a donor spends $2767 for their travel expenses to the transplant center. Of the 3918 applications that have been submitted, 1941 of those applicants (50%) have completed their donor surgery.

Monday, September 26, 2016

The effects of Israel's new organ transplantation law on family consent for deceased donation

Deceased donor organs are a scarce resource with the property that how they are allocated may influence their scarcity, by influencing the decisions of potential donors and their families.  Recent changes in Israeli law give us a window on this...
Incentivizing Authorization for Deceased Organ Donation With Organ Allocation Priority: The First 5 Years
by A. Stoler, J. B. Kessler, T. Ashkenazi, A. E. Roth, J. Lavee

American Journal of Transplantation, Volume 16, Issue 9, September 2016
Pages 2639–2645


The allocation system of donor organs for transplantation may affect their scarcity. In 2008, Israel's Parliament passed the Organ Transplantation Law, which grants priority on waiting lists for transplants to candidates who are first-degree relatives of deceased organ donors or who previously registered as organ donors themselves. Several public campaigns have advertised the existence of the law since November 2010. We evaluated the effect of the law using all deceased donation requests made in Israel during the period 1998–2015. We use logistic regression to compare the authorization rates of the donors’ next of kin in the periods before (1998–2010) and after (2011–2015) the public was made aware of the law. The authorization rate for donation in the period after awareness was substantially higher (55.1% vs. 45.0%, odds ratio [OR] 1.43, p = 0.0003) and reached an all-time high rate of 60.2% in 2015. This increase was mainly due to an increase in the authorization rate of next of kin of unregistered donors (51.1% vs. 42.2%). We also found that the likelihood of next-of-kin authorization for donation was approximately twice as high when the deceased relative was a registered donor rather than unregistered (89.4% vs. 44.6%, OR 14.27, p < 0.0001). We concluded that the priority law is associated with an increased authorization rate for organ donation.

Sunday, September 25, 2016

Notes from China 2: Lanzhou

I spoke in Lanzhou on Thursday, in Gansu Province, as part of a festival promoting the revival of the Silk Road as a market for international trade. The sponsors were Time Weekly, Readers Group (a wide circulation, Readers Digest kind of, and the provincial government.

Here's an interview published in China Daily:

作者:孟肖 来源:时代周刊 2016-09-20
Google translate renders the headline this way: Nobel laureate Erwin Ross: Chinese market must be designed by a Chinese economist
Author: Meng Xiao Source: Times 2016-09-20 
Kwong Sunrise Photo--Al Roth 

The provincial museum is well worth a visit.

And the Yellow River has some beautiful bridges: I took these photos from a riverboat at night.

I recommend the Lanzhou beef noodles, which I had for lunch  The banquet food in Lanzhou is also easy for Americans--fish, lamb, beef and Yak were prominent. (Yak is a kosher animal, by the way...). And toasting goes on throughout, not just in wine but in 100 proof rice liquor...

And in case you were wondering how to spell Erwin Ross in Chinese, I think this is it:

Notes from China 1: Changsha

The first of two stops on my recent trip to China was in Changsha, in Hunan province.  I spoke about market design, following the publication of Who Gets What and Why in Chinese (the Chinese title was changed to The Sharing Economy, but the subtitle was still The New Economic of Matchmaking and Market Design).

Here's a picture I took of the stage, before the talk began:

Here are links to some press coverage, including a visit to ResGreen corporation, a sponsor:

Full coverage


星辰在线 - ‎Sep 20, 2016‎
今日,诺贝尔经济学奖获得者埃尔文-罗斯(Alvin E. Roth)携最新的研究成果来到湖南长沙,走进了以绿之韵集团为代表的中国本土企业,与中国的商业巨鳄、学者专家共同探讨共享经济时代下的市场设计话题。


新浪网 - ‎Sep 19, 2016‎
罗斯(Alvin E. Roth),罗斯因在博弈论、市场设计和实验经济学领域作出的显著贡献,而于2012年获得诺贝尔经济学奖,目前罗斯在哈佛商学院担任经济及工商管理学教授,他多次访问中国,对目前中国经济的 ...


湖南在线 - ‎Sep 21, 2016‎
埃尔文·罗斯(Alvin E。 Roth)考察湖南企业绿之韵公司. 罗斯此行携最新的研究成果,走进了以绿之韵集团为代表的中国本土企业,与中国的商业巨鳄、学者专家共同探讨共享经济时代下的市场设计话题。出席本 ...


红网 - ‎Sep 20, 2016‎
红网综合讯据浏阳经开区消息9月20日上午,诺贝尔经济学奖获得者埃尔文•罗斯(Alvin E. Roth)一行来到浏阳经开区绿之韵集团考察。浏阳经开区党工委副书记、管委会主任郭力夫,绿之韵集团战略发展顾问、 ...

By the way, the food in Hunan is exotic, here's our lunch menu, which has some unusual items (translated for me by Ms Keny Chen):

Lunch Menu 午宴菜品
Cold Dishes|冷菜
Chrysanthemum with special sauce 凉拌苦菊
Vinegar walnut kernel 醋泡核桃仁
Preserved duck egg mixed with pepper 擂辣椒皮蛋
Sauced radish peels 萝卜皮
Salty chicken feet 盐焗凤爪
Fennel with special sauce 凉拌茴香
Main Dishes|热菜
Lobster and salmon sashimi 龙虾三文鱼双拼刺身
Roast suckling pig 鸿运烤乳猪
Roasted goose 烧鹅
Braised local tortoise with soy sauce 红烧土乌龟
Stir-fry snake with spicy sauce 香辣蛇
Lactarius deliciosus braised in brown sauce 黄焖寒菌*
Steamed Leopard Coral Grouper 清蒸蓝东星斑
Steamed scallop with minced garlic and vermicelli 蒜蓉粉丝蒸扇贝
Sautéd razor shell 口味圣子王
Poached domestic chicken 清炖土鸡
Stir-fry snow pea and pleurotus nebrodensis (bailing mushroom) 荷兰豆炒白灵菇
Spiced beef 酱香肉
Steamed ribs with sticky rice and pumpkin 金瓜糯香骨
Stir-fry preserved taro stripe with dried paprika 干椒炒酸芋头丝
Stir-fry diced beef and capsicum 彩椒炒牛仔粒
Stir-fry shrimp with egg white 芙蓉百合
Stir-fry pickles with sliced conch 酸萝卜炒螺片
Stir-fry Chinese edible frog 爆炒田鸡
Stir-fry nostoc commune (agaric) 清炒地木耳
Stir-fry bitter melon with green pepper 清炒苦瓜
Stir-fry Chinese kale (Kai-lan) 清炒芥兰
Fried Glutinous Rice Balls with Sesame 大麻果
Potsticker 锅饺