Bob Wilson and Paul Milgrom, interviewed about their work

 Stanford News has the story:

The bid picture: Stanford economists explain the ideas behind their 2020 Nobel Memorial Prize in Economic Sciences

"If designed correctly, auctions can distribute resources fairly, according to Stanford economists Robert Wilson and Paul Milgrom. The pair were awarded the 2020 Nobel Memorial Prize in Economic Sciences for their improvements to auction theory and inventions of new auction formats."

Here's the video:

Paying for plasma to be legal in Alberta

 Reason magazine has the story:

Canada Inches Closer to Allowing More People To Be Paid for Plasma--For too long, our northern neighbors have depended on plasma imported from the U.S. to meet demand. With the passage of new legislation in Alberta, this may change.  by LIZ WOLFE 

"Albertans will soon be able to receive payment for their blood and plasma donations. Bill 204, the Voluntary Blood Donations Repeal Act, was introduced by Tany Yao, a member of the legislative assembly for Alberta's provincial government, and passed in the legislature this week. It must now get royal assent—a mere formality—for it to become law. The bill overturns a 2017 prohibition on paid plasma, and will allow private companies to pay plasma donors for their efforts. If they so choose, people will still be able to donate blood and plasma without receiving compensation via Canadian Blood Services.

...

"United Nurses of Alberta's president Heather Smith told Global News that "the government is putting its ideology and desire to support profiteers above what is actually safe for Albertans and Canadians." Elsewhere she said that "donating blood should not be viewed as a business venture."

HT: Peter Jaworski

Colin Sullivan on organ transplant policy (and on the job market this year)

 Colin Sullivan is completing a two-year postdoc at Stanford this year, and is on the job market.

His job market paper is an experiment with an exceptionally creative design. (Spoiler: it involves a cat actually getting a kidney transplant.) 

Eliciting Preferences Over Life And Death: Experimental Evidence From Organ Transplantation by Colin by D. Sullivan

Abstract: Optimal allocation of scarce, life-saving medical treatment depends on society’s preferences over survival distributions, governed by notions of equality and  efficiency.  In  a  novel  experiment,  I  elicit  preferences  over  survival  distributions in incentivized, life-or-death decisions. Subjects allocate an organ transplant among real cats with kidney failure. In each choice, subjects allocate a single organ based on the expected survival of each patient. The survival rates imply a price ratio, allowing me to infer the shape of indifference curves over survival bundles. I find that the vast majority (80%) of subjects respond to  increases  in  total  expected  survival  time,  while  a  small  minority  display Leontief preferences, providing the transplant to the shortest-lived patient at all  price  ratios.  Hypothetical  decisions  may  not  be  reliable  in  this  context: a large share (46%) of subjects allocate a hypothetical transplant differently than a real transplant, though estimates of aggregate preferences are the same across incentivized and unincentivized conditions. Finally, I show that aversion to wealth inequality is a good predictor of aversion to survival inequality.

(This human subjects research proto-col  was  approved  by  the  Stanford  University  Institutional  Review  Board  (IRB).  A discussion of ethical considerations in designing this protocol is included in Appendix A.)

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It's not his first really very creative experimental design: check out is 2019 paper in the AER: 

Incentivized Resume Rating: Eliciting Employer PreferencesWithout Deception (With Judd B. Kessler And Corinne Low)

American Economic Review, 2019, Vol. 109 (11): 3713-44. Online Appendix

Abstract: We introduce a new experimental paradigm to evaluate employer preferences, called Incentivized Resume Rating (IRR). Employers evaluate resumes they know to be hypothetical in order to be matched with real job seekers, preserving incentives while avoiding the deception necessary in audit studies. We deploy IRR with employers recruiting college seniors from a prestigious school, randomizing human capital characteristics and demographics of hypothetical candidates. We measure both employer preferences for candidates and employer beliefs about the likelihood candidates will accept job offers, avoiding a typical confound in audit studies. We discuss the costs, benefits, and future applications of this new methodology.

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My advice if you're hiring: check him out.

Akhil Vohra on unravelling (and on the job market this year)

Akhil Vohra, who will be finishing his Ph.D. in Economics at Stanford this year, has been thinking about unraveling for a long time.  His job market paper explores a novel channel by which markets can unravel in time, with early, inefficient hiring, even when talent isn't scarce.

Unraveling and Inefficient Matching by Akhil Vohra 

Job Market Paper, November 5, 2020

Abstract: Labor markets are said to unravel if the matches between workers and firms

occur inefficiently early, based on limited information. I argue that a significant determinant of unraveling is the transparency of the secondary market, where firms can poach workers employed by other firms. I propose a model of interviewing and hiring that allows firms to hire on the secondary market as well as at the entry level. Unraveling arises as a strategic decision by low-tier firms to prevent poaching. While early matching reduces the probability of hiring a high type worker, it prevents rivals from learning about the worker, making poaching difficult. As a result, unraveling can occur even in labor markets without a shortage of talent. When secondary markets are very transparent, unraveling disappears. However, the resulting matching is still inefficient due to the incentives of low-tier firms to communicate that they have not hired top-quality workers. Coordinating the timing of hiring does not mitigate the inefficiencies because firms continue to act strategically to prevent poaching.

You can see him talk about his job market paper in this four minute video:

 

He applies his model to a number of labor markets, both those which are unraveled and those which aren't:

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My advice if you're hiring: check him out.

Price gouging during the pandemic: NY law revised and enforced

 Here's the press release from the office of the Attorney General of New York:

Attorney General James Stops Three Amazon Sellers from Price Gouging Hand Sanitizer and Recoups Funds for New Yorkers:  Sellers to Pay More Than $52,000 in Penalties and Nearly $23,000 in Consumer Restitution--AG James Reminds Sellers Price Gouging is Unlawful During Pandemic

"New York Attorney General Letitia James today announced that she has stopped three Amazon sellers from price gouging hand sanitizer during the coronavirus disease 2019 (COVID-19) public health crisis, and that she will help deliver tens of thousands of dollars back into the pockets of defrauded New Yorkers. Three sellers — Yvette Chaya d/b/a Northwest-Lux (Northwest-Lux), Mobile Rush, Inc. d/b/a Best_Deals_27 (Mobile Rush), and EMC Group, Inc. d/b/a Supreme Suppliers (EMC) — will pay the state of New York more than $52,000 in penalties and reimburse consumers almost $23,000 for overcharging for hand sanitizer during the pandemic.

“Price gouging on necessary consumer supplies during an unprecedented public health emergency is absolutely unconscionable and will not be tolerated,” said Attorney General James. “Instead of ensuring individuals could protect themselves from the coronavirus, these businesses operated with dirty hands by charging exorbitant prices on hand sanitizer and other cleansing products. My office will continue to clean up this unlawful practice by using all of the tools at our disposal to prevent price gouging during this pandemic.

...

"The OAG has already issued more than 1,800 cease-and-desist orders to businesses that stand accused of violating New York’s price gouging law. 

...

"Sellers should be aware that New York revised its price gouging statute, effective June 6, 2020, to impose increased penalties against those who price gouge essential items during a pandemic."

Adventures in transplant transport

 Speedy transport of transplantable organs is an important part of transplantation.  Sometimes the logistics are more exciting than you would like.  Here are two news stories:

Donated Heart Survives Helicopter Crash and Being Dropped by Medic--The heart was successfully transplanted moments later.  By Loukia Papadopoulos

Italian Police Use Lamborghini To Transport Donor Kidney 300 Miles In Two Hours   by Elizabeth Blackstock  (HT Scott Kominers)

Pandemic inspired changes in the economy that may last--real estate and medicine

 In academia, Zoom seminars may coexist with in-person seminars long after the pandemic has ended. They aren't as nice as in-person seminars, but they involve much less air travel.

Business meetings too can more easily be conducted remotely these days, through Zoom, Google Meet, Microsoft Teams, etc. Once again, there's something missing compared to in person meetings, but that's counterbalanced by the skipped travel.

Exercise has changed--fewer visits to the gym, but internet companies like Peloton and Mirror combine home gym equipment with workouts in internet gym classes.

Here are some other items that have caught my eye:

Real Estate Transactions Go Virtual--The traditional real estate closings with a room full of people and stacks of documents are becoming a memory, as much of the process is now online.  By Sydney Franklin in the NY Times

"Real estate transactions have gone largely digital as the pandemic has disrupted nearly every aspect of home buying, from house hunting to securing a mortgage, getting an appraisal, notarizing documents and signing the final closing documents.

...

"While some clients continue to prefer in-person closings, others are giving their lawyers power of attorney to sign the final documents for them or they’re executing closings on virtual platforms like DocuSign.

...

"By the time New York’s real estate market reopened in June after several months of coronavirus restrictions, most buyers were prioritizing virtual tours before reaching out for an in-person visit.

...

"Since March 31, an executive order by Gov. Andrew M. Cuomo has allowed notaries in New York to sign documents using audio-video technology instead of signing and notarizing documents in person.

"Dawn Pereyo, an underwriter and past president of the New York State Land Title Association, says this work flow is the way of the future. Twenty-nine states, not including New York, have already enacted permanent remote online notarization (RON) legislation. “The executive order has allowed us to start down the road of RON,” she said.

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And this:

20 Ways 2020 Changed How We Use Technology Forever--Our reliance on technology while isolated at home these past months—whether Zooming into weddings or FaceTiming with doctors—has permanently altered our relationship to gadgets.   By Matthew Kitchen in the WSJ

"telemedicine and teletherapy visits became the norm. According to a survey by the American Psychiatric Association, the percentage of patients regularly using some form of telehealth with a professional rose from 2.1% pre-pandemic to more than 84.7% as of this summer."