Friday, July 31, 2020

Australia-New Zealand kidney exchange program

New Zealand and Australia are cooperating with cross-border, international kidney exchange.

The Australian has the story:
The chain gang
By RICKY FRENCH

"Facilitated by the Organ and Tissue Authority, the Australian and New Zealand Paired Kidney Exchange (ANZKX) has now given 42 people new kidneys since that first operation late last year. While paired kidney exchange has happened in Australia since 2010, this is the first true international collaboration. Eleven chains of operations occurred before Covid-19 stalled things in March, but recruitment into the program continues and there are six surgeries planned in Australia for August.
...
"[Linda] Cantwell is the ­Australian Red Cross ANZKX tissue typing scientist. She’s gatekeeper to the matrix of matches needed to link up potential pairs. There are currently 150 donors and 128 potential recipients in the pool, but for some people only one donor in 10,000 might be suitable. A computer program called OrganMatch runs the algorithms based on each person’s unique antibody profile and tissue typing, and potential matches from up to 300,000 different chains are produced."
************

And here's a related story from Australia's Daily Telegraph:

Organ donation hit hard by COVID-19 global pandemic
by Jane Hansen

"The Australian and New Zealand Paired Kidney Exchange was suspended from March 6 and can only begin if and when travel restrictions lift.

"Deceased kidney and live kidney donor programs across Australia were also suspended from March 24 and only recommenced in May, blowing out waitlists.

"Liver, heart, lung, paediatric and multi-organ transplant programs have continued but are subject to case-by-case review by the National Transplantation and Donation Rapid Response Taskforce, which meets weekly to discuss the response to COVID-19, the Organ and Tissue Authority said.

"According to the latest figures for 2019, the families of 548 loved ones transformed the lives of 1444 Australians by agreeing to organ donation.

"In 2019, 1309 had the potential to be organ donors but just over half of those families agreed."

Thursday, July 30, 2020

Surrogacy and global kidney exchange receive popular support even where banned, in PNAS by Roth and Wang


Popular repugnance contrasts with legal bans on controversial markets
Alvin E. Roth and  Stephanie W. Wang
PNAS first published July 29, 2020 https://doi.org/10.1073/pnas.2005828117
reviewed by Nicola Lacetera and Mario Macis

Abstract: We study popular attitudes in Germany, Spain, the Philippines, and the United States toward three controversial markets—prostitution, surrogacy, and global kidney exchange (GKE). Of those markets, only prostitution is banned in the United States and the Philippines, and only prostitution is allowed in Germany and Spain. Unlike prostitution, majorities support legalization of surrogacy and GKE in all four countries. So, there is not a simple relation between public support for markets, or bans, and their legal and regulatory status. Because both markets and bans on markets require social support to work well, this sheds light on the prospects for effective regulation of controversial markets.


"Our main result is that (unlike prostitution) the laws banning surrogacy and GKE do not seem to reflect popular demand. Neither do these bans reflect that opponents of legalization feel more strongly than supporters.
...
"All three transactions are the subject of current debate in at least one of the countries we surveyed.¶¶ Based on the results of our surveys, we do not see entrenched popular resistance to either surrogacy or GKE (or simple kidney exchange) where it is presently illegal, and thus, we anticipate that efforts to lift or circumvent current restrictions are likely to be increasingly successful, while efforts to legalize or decriminalize prostitution where it is presently illegal may face greater opposition from the general public.

"Understanding these issues is important, not just for the hundreds of Spanish couples stranded outside of Spain while they look for a way to bring their surrogate children home and not just for the people in need of kidney exchange but for whom it is out of reach in Germany or in the Philippines. These issues are also of importance to social scientists in general and economists in particular. When markets enjoy social support, when they are banned, and when, in turn, bans are socially supported are questions that touch upon many transactions, particularly as social and economic interactions are increasingly globalized.

"Our findings suggest that the answer to these questions may not be found in general public sentiment in countries that ban markets or legalize them. Rather, we may have to look to the functioning of particular interested groups, perhaps with professional or even religious interests, that are able to influence legislation in the absence of strong views (or even interest) among the general public about the markets in question."
************

Here's the published citation:
Roth, Alvin E. and Stephanie W. Wang, “Popular Repugnance Contrasts with Legal Bans on Controversial Markets,” Proceedings of the National Academy of Sciences (PNAS),  August 18, 2020 117 (33) 19792-19798; https://doi.org/10.1073/pnas.2005828117 

Wednesday, July 29, 2020

Emmanuel Farhi 1978-2020

Emmanuel Farhi passed away last week, unexpectedly and tragically.  He was my colleague at Harvard, and we had recently sought to hire him at Stanford.  

Here's the Harvard Economics department memorial, which contains moving testimonials: 


This has been a hard year at Harvard, with four deaths in the department in the last 12 months.



Tuesday, July 28, 2020

Stanford campus in lockdown--pictures

Stanford is under-crowded in these coronavirus lockdown days of July...




Monday, July 27, 2020

JET Stanford

Here's an email sent yesterday by my department chair:

"It has belatedly come to my attention that the Journal of Economic Theory recently published a 50th anniversary issue, which included a collection of the 50 most influential papers included in the journal since its inception.  Nine of those papers included coauthors who are members of our department.  Special congratulations to Paul Milgrom, who coauthored four of them! 

Here are the Stanford-Econ-coauthored papers on the list (I REALLY hope I didn't overlook any -- if so, please let me know!): 

David Kreps, Paul Milgrom, John Roberts, and Robert Wilson, “Rational cooperation in the finitely repeated prisoners’ dilemma,” JET, August 1982. 
Paul Milgrom and John Roberts, “Predation, reputation, and entry deterrence,” JET, August 1982. 
Paul Milgrom and Nancy Stokey, “Information, trade and common knowledge,” JET, February 1982.   
B. Douglas Bernheim, Bezalel Peleg, and Michael Whinston, “Coalition-Proof Nash Equilibria I. Concepts,” JET, June 1987. 
Drew Fudenberg, Bengt Holmstrom, and Paul Milgrom, “Short-term contracts and long-term agency relationships,” JET, June 1990. 
Matthew Jackson and Asher Wolinsky, “A Strategic Model of Social and Economic Networks,” JET, October 1996. 
Matthew Jackson and Alison Watts, “The evolution of social and economic networks,” JET, October 2002. 
Larry Epstein and Martin Schneider, “Recursive multiple-priors,” JET, November 2003. 
Alvin Roth, Tayfun Sonmez, and M. Utku Unver, “Pairwise kidney exchange,” JET, December 2005. 

Best, 

Doug

B. Douglas Bernheim
Edward Ames Edmonds Professor of Economics
Chair, Department of Economics"
******************

And here is the full list of 50 papers:

Sunday, July 26, 2020

Chocolate is good for your heart

Breaking (good) news on the chocolate science front--from the European Journal of Preventive Cardiology

Association between chocolate consumption and risk of coronary artery disease: a systematic review and meta-analysis
Chayakrit Krittanawong, Bharat Narasimhan, Zhen Wang, Joshua Hahn, Hafeez Ul Hassan Virk, Ann M Farrell, HongJu Zhang, WH Wilson Tang
First Published July 22, 2020  https://doi.org/10.1177/2047487320936787

"Clinical trials have shown that the consumption of chocolate has favorable effects on blood pressure and endothelial function.1 The previous meta-analysis showed that many dietary components, including chocolate, appear to be beneficial for cardiovascular disease.2 However, the potential benefit of increased chocolate consumption, reducing coronary artery disease (CAD) risk is not known. We aimed to explore the association between chocolate consumption and CAD.
...
"In the present meta-analysis, we found that chocolate consumption (>1 time per week or >3.5 times per month) is associated with a reduced risk of CAD."



Saturday, July 25, 2020

Speed dating, and matchmaking via Zoom, in Japan

The Washington Post has the story:

Lockdowns make the heart grow fonder in Japan as online matchmaking surges
By Simon Denyer and Akiko Kashiwagi   July 12, 2020

"Online matchmaking in Japan has become a rare upbeat counterpoint to the economic slowdowns, shutdowns and restrictions during the covid-19 crisis.

"Matchmaking agencies say the video encounters have proved to be a hit, removing the pressures of arranged face-to-face sessions in a society that often discourages being bold and open in first meetings.
...
"LMO and other companies tend to start with a group meeting conducted over Zoom: An emcee makes everyone comfortable, helps them introduce themselves and asks them a few questions to spark conversation. How have you been being spending your time at home? How do you imagine married life to be? What are your dreams? Then participants pair off into breakout rooms and spend several minutes chatting to each prospective partner in turn."

Friday, July 24, 2020

Experiments on school choice: a survey by Hakimov and Kübler


Hakimov, R., Kübler, D. Experiments on centralized school choice and college admissions: a survey. Exp Econ (2020). https://doi.org/10.1007/s10683-020-09667-7

Abstract: The paper surveys the experimental literature on centralized matching markets, covering school choice and college admissions models. In the school choice model, one side of the market (schools) is not strategic, and rules (priorities) guide the acceptance decisions. The model covers applications such as school choice programs, centralized university admissions in many countries, and the centralized assignment of teachers to schools. In the college admissions model, both sides of the market are strategic. It applies to college and university admissions in countries where universities can select students, and centralized labor markets such as the assignment of doctors to hospitals. The survey discusses, among other things, the comparison of various centralized mechanisms, the optimality of participants’ strategies, learning by applicants and their behavioral biases, as well as the role of communication, information, and advice. The main experimental findings considered in the survey concern truth-telling and strategic manipulations by the agents, as well as the stability and efficiency of the matching outcome.


From the Conclusions:

"The purpose and style of experiments on school choice and college admissions has changed over time. Many of the early experiments were tests of the theory. Horse races between different school choice mechanisms were conducted. Recently, many studies have dealt with systematic biases in behavior that matter in matching markets, such as bounded rationality, biased self-assessments, etc. Moreover, recent work also focuses on the question of how the exact implementation of a mechanism, e.g., static versus dynamic, with or without advice, afects market outcomes. Thus, the matching literature has started to establish behavioral regularities that can be of interest for policy makers involved in market design and behavioral theorists."

Thursday, July 23, 2020

Deceased organ donation by presumed consent, when families must also consent

Presumed consent to be an organ donor becomes complicated when the next of kin of the deceased potential donor must also consent:

Costa-Font, J., Rudisill, C. & Salcher-Konrad, M. ‘Relative Consent’ or ‘Presumed Consent’? Organ donation attitudes and behaviour. Eur J Health Econ (2020). https://doi.org/10.1007/s10198-020-01214-8

Abstract: "Legislation, in the form of presumed consent, has been argued to boost organ donation but most evidence disregards the practice of seeking relative’s consent, which can either ‘veto’ donation decisions, or ‘legitimize them’, by removing any possible conflict with the donor’s family. We study the effect of presumed consent alongside family consent on individuals’ willingness to donate (WTD) one’s own and relatives’ organs, and on actual organ donation behaviours. Using data from 28 European countries for the period 2002–2010, we found that presumed consent (PC) policies are associated with increased willingness to donate organs, but this effect was attenuated once internal family discussions on organ donation were controlled for. Our findings indicate that relative’s consent acts as a veto of donation intentions and attenuates the effect of regulation on actual donations. More specifically, PC increases WTD one’s own and relatives’ organs in countries where no family consent is required. Consistently, we find that family consent attenuates the influence of regulatory environment on actual donations. The effect is driven by the influence of family discussions which increased WTD, and in combination with presumed consent translated into higher organ donation rates."


Wednesday, July 22, 2020

More applications, from fewer applicants per position in Vascular Surgery residencies


Trends in the 10-year history of the vascular integrated residency match: More work, higher cost, same result
Katherine K.McMackin MD, Francis J.Caputo MD, Nicholas G.Hoell MD, JoseTrani MD, Jeffrey P.Carpenter MD, Joseph V.Lombardi MD
Journal of Vascular Surgery, Volume 72, Issue 1, July 2020, Pages 298-303


"During the last 10 years, the number of vascular surgery integrated residency spots rose from 9 to 60 per year. Most programs offer one spot per year; none offer more than two. The average number of applications received by programs rose from 17 applications in 2008 to 63.8 in 2017. The average rank list depth needed by programs to fill the spots has not increased (range, 2.5-5.1; standard deviation, 0.73). The proportional depth of the applicant pool decreased from 4.6 U.S. and Canadian applicants for every one residency spot in 2008 to 1.7 applicants for every one residency spot in 2017. Applicant quality metrics were available for 2 years (2014 and 2016). Step 1 scores (237/239), Step 2 scores (250/250), research experiences (3.7/4.2), and volunteer experiences (5.9/5.5) remained nearly unchanged. The number of contiguous ranks for matched applicants remained stable (12.3/12.8).

"Conclusions:
The current system promotes multiple inefficiencies, resulting in application glut. Fewer applicants are flooding programs with an increasing number of applications. More money is being spent on Electronic Residency Application Service applications without changes in the number needed to rank by applicants or programs to achieve a match. There is no improvement in the quality of the applicant. Should these trends continue, they represent an unsustainable model for resident selection."

Tuesday, July 21, 2020

Computer security and defending against insider attacks

Twitter suffered a very public attack on Wednesday, apparently only for the purpose of a bitcoin scam. But the scope of the attack raises all sorts of security questions, including how to guard against insider attacks.

Here's the NY Times story:
A Brazen Online Attack Targets V.I.P. Twitter Users in a Bitcoin Scam
In a major show of force, hackers breached some of the site’s most prominent accounts, a Who’s Who of Americans in politics, entertainment and tech.
By Sheera Frenkel, Nathaniel Popper, Kate Conger and David E. Sanger

"Twitter’s investigation into the breach revealed that several employees who had access to internal systems had their accounts compromised in a “coordinated social engineering attack,” a spokesman said, referring to attacks that trick people into giving up their credentials. The attackers then used Twitter’s internal systems to tweet from high-profile accounts like Mr. Biden’s."
************

Twitter tweeted the following:

Twitter Support
@TwitterSupport
We detected what we believe to be a coordinated social engineering attack by people who successfully targeted some of our employees with access to internal systems and tools.
7:38 PM · Jul 15, 2020·Twitter Web App
 *************
If there was ever a time in the past at which corporate computer security was merely a matter of building a wall between outsiders and inside information, that time is now well past.  This twitter attack was, at least in some respects, an insider attack, by someone with access to Twitter employees' access. Whether that access was obtained by fooling the employees, coercing them, or co-opting them is less important than the fact that, apparently, some (and perhaps many) twitter employees had access of a sort that let them do things that they would never have to do as part of their jobs.

(Here's an earlier post which includes a link to a story in which a twitter employee was apparently also working for Saudi intelligence: Saturday, March 14, 2020 Organizations' security policies in the news)

Regardless of how this recent attack was carried out, I'm sure that twitter is now looking hard at internal access and starting to think about how to avoid insider attacks by limiting the access of many employees.

As companies adopt "counterintelligence" security policies of this sort, there is a hidden cost, because openness promotes fruitful cooperation and problem solving, not just security vulnerabilities.

Monday, July 20, 2020

SCIENTISTS FOR SCIENCE-BASED Policy (even more, and again)--open letter

Here's a self explanatory email:

Dear NAS Colleagues,

We are deeply appreciative of your decision in spring 2018 to sign the Statement to Restore Science-Based Policy in Government. website https://scientistsforsciencebasedpolicy.org/ 

We are writing now to update you.  This past month we contacted members newly elected in 2019 and 2020, asking if they would like to add their names to the Statement. Although much has happened in the past two years, we decided to keep the text of the Statement  unchanged.  Its wording remains as relevant today as earlier, perhaps even more so.

We are pleased to report that about 62 percent of the new members have signed, raising the total number to over 1220.  We are now distributing the explanatory statement below to selected journalists. This statement is also available at

We would be happy if you would disseminate this information as you think appropriate.  Moreover, should you be in touch with members who have not yet signed the Statement and wish to do so, please have them email us and we will add their names.

Regards,


Charles Manski, Ben Santer, and Ray Weymann,  NAS members
********

Here's the closing paragraph of the original (and reissued) letter:

"Scientific evidence and research should be an important component of policymaking. We therefore call on the Federal Government to maintain scientific content on publicly accessible websites, to appoint qualified personnel to positions requiring scientific expertise, to cease censorship and intimidation of Government scientists, and to reverse the decision to withdraw the United States from the Paris Agreement."
******

And here are the opening paragraphs of the historical context document:

"Pandemic Exposes Fatal Consequences of Dismissing Scientific Expertise
1,220 members of the National Academy of Sciences call for science-based policy
July 16, 2020

“Ignorance and wishful thinking are not effective response strategies in the face of a global pandemic or global climate change,” said Dr. Ben Santer, one of three co-organizers of this open letter. “We need to restore science-based policy in government – but we also need to ensure that science is valued in public discourse and in all levels of our educational system.”

"This call for restoring science to policymaking has a several-year history. In the summer of 2016, while campaigning for the Republican nomination for the U.S. Presidency, Donald J. Trump publicly announced his intention to withdraw the United States from the Paris Climate Accord. This announcement – and Mr. Trump’s public dismissal of climate science as “a hoax” – prompted four members of the U.S. National Academy of Sciences to write an open letter (http://responsiblescientists.org). The letter’s purpose was to affirm the reality and seriousness of human-caused climate change. It pointed out the severe and long-lasting consequences of an eventual U.S. withdrawal from the Paris Climate Accord. At the time of its publication in September 2016, the open letter had 378 NAS signatories."

Sunday, July 19, 2020

Stony Brook Game Theory conference, July 20-24


International Conference on Game Theory, Zoom Webinar, July 20 - 24, 2020  (Registration here)

Monday, July 20

09:30 - 10:15  Éva Tardos  (Cornell University)
Stability and Learning in Strategic Queuing Systems
10:15 - 11:00 Tilman Börgers  (University of Michigan)
Learning Simplicity
11:00 - 11:15 Break
11:15 - 12:00 Plenary Address
Daron Acemoglu  (Massachusetts Institute of Technology)
Too Much Data: Prices and Inefficiencies in Data Markets
12:00 - 12:45 Break
12:45 - 13:30  Plenary Address
Yuliy Sannikov  (Stanford Graduate School of Business)
TBA
13:30 - 13:45 Break
13:45 - 14:30 John Geanakoplos  (Yale University)
Money and Status: How to Incentivize Work in a Meritocracy
14:30 - 15:15 Alexander Frankel  (University of Chicago Booth School of Business)
Information Hierarchies
15:15 - 16:00 Andreas Blume  (University of Arizona)
Information Processing: Contracts versus Communication

Tuesday, July 21

09:30 - 10:15 Ran Spiegler  (Tel Aviv University )
Cheating with (Recursive) Models
10:15 - 11:00 Kareen Rozen  (Brown University)
TBA
11:00 - 11:15 Break
11:15 - 12:00 Plenary Address
Robert J. Aumann  (Hebrew University of Jerusalem)
A Synthesis of Behavioral and Mainstream Economics
12:00 - 12:45 Break
12:45 - 13:30  J. Aislinn Bohren  (University of Pennsylvania)
Inaccurate Statistical Discrimination: An Identification Problem
13:30 - 14:15 Ignacio Esponda  (University of California Santa Barbara)
Asymptotic Behavior of Bayesian Learners with Misspecified Models
14:15 - 14:30 Break
14:30 - 15:15 Dirk Bergemann  (Yale University)
Search, Information and Prices
15:15 - 16:00 Hector Chade  (Arizona State University)
Screening in Vertical Oligopolies

Wednesday, July 22

09:30 - 10:15 Myrna Wooders  (Vanderbilt University)
Non-Cooperative Team Formation and a Team Formation Mechanism
10:15 - 11:00 George J. Mailath  (University of Pennsylvania)
Coalition-Proof Risk Sharing Under Frictions
11:00 - 11:15 Break
11:15 - 12:00 Plenary Address
Oliver Hart  (Harvard University)
Prosocial Corporate Governance
12:00 - 12:45 Break
12:45 - 13:30 Vasiliki Skreta  (UT Austin and University College London)
Information Design by an Informed Designer
13:30 - 14:15 Kyungmin Kim  (Emory University)
Competition under Moment Conditions
14:15 - 14:30 Break
14:30 - 15:15 Juan Ortner  (Boston University)
Bargaining with Evolving Private Information
15:15 - 16:00 Marcin Pęski  (University of Toronto)
Bargaining under Incomplete Information

Thursday, July 23

09:30 - 10:15 Jörgen Weibull  (Stockholm School of Economics)
John Nash Meets Immanuel Kant: Moral Motivation in Strategic Interactions
10:15 - 11:00 Aviad Heifetz  (The Open University of Israel)
Liberal Parentalism
11:00 - 11:15 Break
11:15 - 12:00 Plenary Address
Parag Pathak  (Massachusetts Institute of Technology)
Leaving No Ethical Value Behind: Triage Protocol Design for Pandemic Rationing
12:00 - 12:45 Break
12:45 - 13:30 Plenary Address
Matthew Gentzkow  (Stanford University)
Ideological Bias and Trust in Information Sources
13:30 - 13:45 Break
13:45 - 14:30 Marzena Rostek  (University of Wisconsin-Madison)
Decentralized Market Design
14:30 - 15:15 Yeon-Koo Che  (Columbia University)
Weak Monotone Comparative Statics
15:15 - 16:00 Leeat Yariv  (Princeton University)
Dominance Solvability in Random Games

Friday, July 24

09:30 - 10:15 Nicole Immorlica  (Microsoft Research New England)
Incentivizing Exploration with Selective Data Disclosure
10:15 - 11:00 Sven Rady  (Universitat Bonn)
Overcoming Free-Riding in Bandit Games
11:00 - 11:15 Break
11:15 - 12:00 Plenary Address
Jean Tirole  (Toulouse School of Economics)
Digital Dystopia
12:00 - 12:45 Break
12:45 - 13:30 S. Nageeb Ali  (Pennsylvannia State University)
Reselling Information
13:30 - 14:15 Rachel E. Kranton  (Duke University)
Social Networks and the Market for News
14:15 - 14:30 Break
14:30 - 15:15 Hülya K. K. Eraslan  (Rice University)
Efficiency with Political Power Dynamics and Costly Policy Change
15:15 - 16:00 Lones Smith  (University of Wisonsin-Madison)
The Behavioral SIR Model with Applications to COVID-19 and the Swine Flu Pandemics

Saturday, July 18, 2020

Bill Sandholm (1970-2020)

The evolutionary game theorist Bill Sandholm has left the game.

Here's the memoriam from the Game Theory Society:
In Memoriam: William H. Sandholm (1970-2020)

And here's the obit from the Department of Economics at the University of Wisconsin, where he spent his career. It lists the cause of death as depression.
In Memoriam: William H. (Bill) Sandholm, leading evolutionary game theorist, cherished mentor and valued colleague

Here's his home page at the University of Wisconsin: Bill Sandholm's Home Page
Here's his Google Scholar page: William H. Sandholm

Friday, July 17, 2020

Open letter supporting human challenge trials for COVID-19 vaccines


Here's the website of the advocacy organization 1 Day Sooner (where you can read about human challenge trials, and volunteer for one). It was founded by Josh Morrison (who also founded the kidney transplant donor advocacy organization Waitlist Zero) and Sophie Rose.

Here's the open letter they recently sent to Dr. Francis Collins, at the National Institutes of Health
 Challenge Trials for COVID-19

Here's the press release:
1Day Sooner Open Letter Press Release
"15 NOBEL LAUREATES, OVER 100 PROMINENT FIGURES, AND OVER 2,000 1DAY SOONER VOLUNTEERS SIGN OPEN LETTER TO DR. FRANCIS COLLINS IN SUPPORT OF COVID-19 HUMAN CHALLENGE TRIALS

"Adrian Hill, Director of the Jenner Institute at the University of Oxford, writes that “Oxford’s Jenner Institute and 1Day Sooner are collaborating on work towards the production of a COVID-19 human challenge virus,” and “collaborative human challenge studies should be feasible and informative in the coming months.”

I'm one of the signers of the open letter, and the quote that goes along with my picture in the press release is
A safe and effective vaccine will be incredibly valuable, and the sooner the better.  Challenge trials make sense. We should prepare carefully, and proceed bravely and gratefully.”
************

Earlier posts:

Friday, May 29, 2020

Thursday, July 16, 2020

Market clearing by queuing, by Ashlagi, Leshno, Qian and Saberi



Queue Lengths as Constantly Adapting Prices: Allocative Efficiency Under Random Dynamics
Itai Ashlagi, Jacob Leshno, Pengyu Qian, and Amin Saberi
EC '20: Proceedings of the 21st ACM Conference on Economics and Computation July 2020 Pages 317–318 https://doi.org/10.1145/3391403.3399539

ABSTRACT
"Waiting lists are common mechanisms for allocating scarce items without monetary transfers. Examples include the allocation of cadaver organs to patients in need of a transplant, public housing apartments to applicants, health care services to patients, and even spots at childcare centers to parents. In all these markets waiting times play the role of prices in guiding the allocation and rationing items. But while prices are set by the designer, waiting times are endogenously determined by the number of agents waiting. Moreover, waiting times are not fixed, and continuously adjust as items arrive or agents join. When agents and items arrive stochastically over time, waiting times stochastically adjust over time.

"The stochastic adaptation of waiting times adversely impacts the allocative efficiency. If utility is quasi-linear in waiting time, standard competitive equilibrium (CE) arguments show that fixed waiting times can serve as market clearing prices and yield the optimal allocative efficiency. But even if one may expect the endogenously generated waiting times to tend towards market clearing prices, the waiting times keep fluctuating and never converge. Agents may arrive when waiting times are far from the market clearing prices, and their assignment can be inefficient.

"This paper evaluates the allocative efficiency loss due to the random fluctuations. We consider a standard waiting list mechanism, which holds a separate First Come First Served (FCFS) queue for each of finitely many items. Items arrive over time according to a Poisson process, and are assigned to the first agent in the respective queue. Agents arrive over time according to a Poisson process, observe the length of each queue, and then choose a queue to join or leave the system. An agent who joins a queue must wait there until he receives the item. Agents have heterogeneous private values over the items, and their utility is quasi-linear in waiting costs. That is, all agents have the same waiting costs. We interpret the expected waiting costs at each queue as prices that stochastically adjust as items arrive or agents join the queues.

"Our key technical observation is that the waiting list's random price adaptation process is equivalent to that of a stochastic gradient descent algorithm (SGD). While each arrival randomly adjusts prices, the expected price adjustment from each arrival moves waiting times towards market clearing prices. However, waiting times never converge. Standard usage of SGD optimization algorithms requires reducing the step size to zero as the algorithm gets closer to the optimal solution. In contrast, the step-size for the waiting list mechanism is determined by the granularity of waiting costs C>0, which is the maximal price impact (i.e., increase in expected waiting costs) of adding one agent to a queue.

"Our first result states that the allocative efficiency loss from the random price fluctuations is O(C), and this bound is tight. We further show that, if there are finitely many agent types and the optimal static assignment problem has a unique dual solution (which generically holds), then the allocative efficiency loss becomes exponentially small as C -> 0."

Wednesday, July 15, 2020

The economics of antibiotics

Penicillin changed the world, it gave us a weapon against disease causing bacteria. Other antibiotics followed. But then evolution changed bacteria--natural selection in an antibiotic rich environment helped them become drug resistant.  Today, the bacteria are sometimes winning--there are some drug resistant bacteria that seem able to resist all available antibiotics. But drug discovery of antibiotics is slowing. What's going on?

Drugs (including antibiotics) are expensive to develop, test for safety and effectiveness, and bring to market.  Part of the problem is that there isn't likely to be a big market for a new super antibiotic. The reason is that, if it is oversubscribed, it will stop being super--bacteria will become resistant.  So a new super antibiotic would be used sparingly, as a drug of last resort.  That's another way of saying that it wouldn't have big sales.

The NY Times has a story:

Drug Giants Create Fund to Bolster Struggling Antibiotic Start-Ups
"New medicines are desperately needed to treat a growing number of drug-resistant infections, but many companies developing the drugs are short on cash and investments."
By Andrew Jacobs, July 9, 2020

"Twenty of the world’s largest pharmaceutical companies on Thursday announced the creation of a $1 billion fund to buoy financially strapped biotech start-ups that are developing new antibiotics to treat the mounting number of drug-resistant infections responsible for hundreds of thousands of deaths each year.

"The fund, created in partnership with the World Health Organization and financed by drug behemoths that include Roche, Merck, and Johnson & Johnson, will offer a short-term but desperately needed lifeline for some of the three dozen small antibiotic companies, many of them based in the United States, that have been struggling to draw investment amid a collapsing antibiotics industry.
...
"“Antibiotics are the mortar that holds the entire health care system together,” said David A. Ricks, the chief executive of Eli Lilly, who helped spearhead the effort. “We make drugs for diabetes, cancer and immunological conditions, but you couldn’t treat any of them without effective antibiotics.”

"In an interview, Mr. Ricks said he was well aware of the irony that Eli Lilly and many of the other companies contributing to the fund were once the giants of antibiotic development but have long since abandoned the field because of their inability to earn money on the drugs. “We know firsthand how broken the system is,” he said.

"The crisis stems from the peculiar economics and biochemical quirks of drugs that kill bacteria and fungi. The more often antimicrobial drugs are used, the more likely they are to lose their efficacy as pathogens survive and mutate. Efforts to promote antibiotic stewardship mean that new drugs are used as a last resort, limiting the ability of companies to earn back the billions of dollars it can take to create a new product.
...
"Between 1980 and 2009, the Food and Drug Administration approved 61 new antibiotics for systemic use; over the past decade that number has shrunk to 15, and a third of the companies behind those medicines have since gone belly up.  Those backing the fund acknowledge that the effort is largely a stopgap measure. Industry executives and public health experts say that fixing the broken marketplace for antibiotics would require sweeping government intervention to create financial incentives for drug companies, including policy changes that would increase reimbursements for lifesaving drugs kept under lock and key and used only when existing therapies fail."

Tuesday, July 14, 2020

Polyamorous domestic partnerships recognized in Somerville, MA

Do people in plural relationships have a different sexual orientation than others (and should maybe be protected by laws prohibiting discrimination based on sexual orientation?)  Are they a different model of marriage (akin to, albeit potentially much more complicated than, same sex marriage?)

Here's the story from the online Somerville Wicked Local ("Wicked" is Massachusetts slang, as in the phrase "wicked good").  Maybe this will be the beginning of something (or the beginning of the end of something...).

Somerville recognizes polyamorous domestic partnerships
By Julia Taliesin  Jul 1, 2020

"The Somerville City Council unanimously approved an ordinance with language inclusive to polyamorous domestic partnerships.

"On June 29, Somerville quietly became one of the first cities in the nation – if not the first – to recognize polyamorous domestic partnerships.

"The historic move was a result of a few subtle language shifts. For example, instead of being defined as an “entity formed by two persons,” Somerville’s ordinance defines a domestic partnership as an “entity formed by people,” replaces “he and she” with “they,” replaces “both” with “all,” and contains other inclusive language.

"On June 25, the City Council passed the ordinance recognizing domestic partnerships unanimously, and on June 29 Mayor Joe Curtatone signed it into municipal law. "

Monday, July 13, 2020

More on plasma, payments, and convalescent plasma

Peter Jaworski gives some more reasons that countries should legalize compensation to plasma donors, rather than buying their plasma products from the U.S.

In Reason:
Americans Get Paid To Donate Plasma. Everyone Else Should Too
Our secret weapon against COVID-19 could be cold, hard cash.  7.2.2020

"American dominance in the plasma market is explained by one simple fact: In America, it is legal and commonplace to pay people to give plasma. Millions of Americans regularly give plasma in exchange for $30 to $50 per donation. The average American donor gives 21.4 times per year, with a per capita collection volume of 113 liters of plasma per 1,000 people. If you add plasma obtained from Germany, Austria, Hungary, and Czechia—the other places where a form of compensation (typically capped at 25 euros, intended only to cover expenses) is offered—paid plasma accounts for a staggering 89 percent of all the plasma used to make plasma therapies for the whole world. Just five countries account for nine-tenths of the world's plasma.
...
"Donor recruitment and retention, staffing, plus marketing costs, combine to make the collection of unpaid plasma two to four times more expensive than just giving money to the donors.
...
"[bans on payment were partly] motivated by the concern that payment attracted people from lower socioeconomic rungs of the economic ladder who are more likely to be carriers of HIV, hepatitis C, and other transfusion-transmissible infections.

"But those concerns no longer apply, partly due to significant improvements in testing technology since the 1970s when the WHO first recommended not paying blood and plasma donors. This improvement in testing happens to form the backbone of arguments among advocates of eliminating restrictions on blood and plasma donation by gay men, which currently require three months of celibacy per the Food and Drug Administration's revised guidance issued this April. But improvements in testing alone are not the reason why plasma for plasma therapies should be considered categorically different from blood and plasma used for transfusions; it is manufacturers' ability to use virus removal and inactivation techniques that marks the stark difference.

"In the 1980s, we discovered that heat treatment was effective against HIV. Much like how washing your hands with soap destroys the coronavirus, use of solvents and detergents are effective against lipid-enveloped viruses, including hepatitis C and HIV. Nanofiltration ensures that only molecules of a certain size—the proteins we want—get through, preventing larger molecules from passing into the plasma pool. Most American paid plasma collection centers are also International Quality Plasma Program (IQPP) certified. This voluntary standard, issued by the Plasma Protein Therapeutics Association, involves additional safety steps including the requirement that any donor's first donation be placed on hold, only to be released with the second donation from the same donor. This holding step gives us an opportunity to test the same plasma twice, avoiding the rare possibility of a virus being within the window period where it cannot be detected. This hold means that if you give plasma once and don't go back, your plasma will be discarded."
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With convalescent plasma donation,  the safety check involved in sequestering the first donation until the second one is also tested for infection is not the only set of tests.  For each donation there is also a measurement of how much Covid-19 antibody (IgG) is present, and if it is enough to be therapeutic. So, for example, after each donation I have to wait for those results to find out if I'll be invited to donate again. (So far, at each visit I give a bit over 800ml of plasma, and that donation is divided into four units of 200ml. My understanding is that my units have so far all been administered to hospitalized Covid-19 patients in Fresno and San Jose.)

Sunday, July 12, 2020

Incorporating patient preferences into transplant decisions can improve welfare--Genie, Nicolo and Pasini in J Health Economics


The role of heterogeneity of patients’ preferences in kidney transplantation
by Mesfin G.GenieaeAntonio NicolóbcGiacomo Pasini
Journal of Health Economics
Volume 72, July 2020, 102331

Abstract: We elicit time and risk preferences for kidney transplantation from the entire population of patients of the largest Italian transplant centre using a discrete choice experiment (DCE). We measure patients’ willingness-to-wait (WTW) for receiving a kidney with one-year longer expected graft survival, or a low risk of complication. Using a mixed logit in WTW-space model, we find heterogeneity in patients’ preferences. Our model allows WTW to vary with patients’ age and duration of dialysis. The results suggest that WTW correlates with age and duration of dialysis, and that accounting for patients’ preferences in the design of kidney allocation protocols could increase their welfare. The implication for transplant practice is that eliciting patients’ preferences could help in the allocation of “non-ideal” kidneys.
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Saturday, July 11, 2020

Economics and Computation 2020 updated program, July 13-16

Scott Kominers forwards this update on the EC conference program, including a shortcut to identify those sessions on market design.


Economics and Computation 2020
The main programming of EC 2020, the leading scientific conference on advances in theory, empirics, and applications at the interface of economics and computation, will be held next week from July 13 to July 16.  The program features invited speakers, a highlight of papers from other conferences and journals, a technical program of paper presentations and posters, workshops, tutorials, and ample opportunities for casual interactions and networking. The conference will be run virtually on the Gather platform, an innovative 2D world that facilitates spontaneous small-group conversations. 

Participation by members of related fields is strongly encouraged.  Registration is mandatory (register here) but complimentary with ACM/SIGecom membership of $10 ($5 for students).  Details on joining events will be emailed to registered participants.

All events are listed on this Google calendar.  Paper sessions are broken down by areas of interest in the Google calendars below.  You can add these calendars to your personal Google calendar by clicking the “+Google” button on the bottom right.

4.     Mechanism Design

Unanswered questions about EC’20 can be directed to the Conference Hosts at sigecom-virtual-EC2020@googlegroups.com.

Friday, July 10, 2020

Blockchain economics, by Catalini and Gans; and Halaburda, Haeringer, Gans and Gandal


Some Simple Economics of the Blockchain
By Christian Catalini and Joshua S. Gans
Communications of the ACM, July 2020, Vol. 63 No. 7, Pages 80-90

"we rely on economic theory to explain how two key costs affected by blockchain technology—the cost of verification of state, and the cost of networking—change the types of transactions that can be supported in the economy. These costs have implications for the design and efficiency of digital platforms, and open opportunities for new approaches to data ownership, privacy, and licensing; monetization of digital content; auctions and reputation systems."
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The Microeconomics of Cryptocurrencies
Hanna Halaburda, Guillaume Haeringer, Joshua S. Gans, Neil Gandal
NBER Working Paper No. 27477  July 2020

Abstract: Since its launch in 2009 much has been written about Bitcoin, cryptocurrencies and blockchains. While the discussions initially took place mostly on blogs and other popular media, we now are witnessing the emergence of a growing body of rigorous academic research on these topics. By the nature of the phenomenon analyzed, this research spans many academic disciplines including macroeconomics, law and economics and computer science. This survey focuses on the microeconomics of cryptocurrencies themselves. What drives their supply, demand, trading price and competition amongst them. This literature has been emerging over the past decade and the purpose of this paper is to summarize its main findings so as to establish a base upon which future research can be conducted.

Thursday, July 9, 2020

Safe injection sites: surreptitious harm reduction, in the NEJM

When healthcare interventions must be conducted secretly, it's likely that something is very wrong with the law.

A letter in the New England Journal of Medicine brings us up to date on safe injection sites, to combat deaths from drug overdoses.

by Alex H. Kral, Ph.D., Barrot H. Lambdin, Ph.D., Lynn D. Wenger, M.S.W., M.P.H., and 
Pete J. Davidson, Ph.D.    July 8, 2020

"Nearly 70,000 people in the United States die each year from a drug overdose.1 Opioid-involved overdose deaths may be preventable by the timely administration of naloxone. Eleven countries have responded to health concerns regarding people who use drugs by opening sanctioned safe consumption sites; however, no such sites exist yet in the United States. Safe consumption sites provide a space for people to bring preobtained drugs and use them with sterile supplies under clean conditions and with safe disposal of used drug equipment. These sites provide monitoring by staff equipped and trained in the use of naloxone to reverse overdose. Most sanctioned sites can also provide related services, including voluntary screening for infectious diseases, peer counseling, wound care, and referral to other social and medical services, such as substance use treatment. 
...
"In September 2014, in response to a local opioid overdose crisis, an organization in an undisclosed U.S. city opened an unsanctioned safe consumption site


"Although this evaluation was limited to one city and one site that is unsanctioned, and therefore the findings cannot be generalized, our results suggest that implementing sanctioned safe consumption sites in the United States could reduce mortality from opioid-involved overdose. Sanctioning sites could allow persons to link to other medical and social services, including treatment for substance use, and facilitate rigorous evaluation of their implementation and effect on reducing problems such as public injection of drugs and improperly discarded syringes."

Wednesday, July 8, 2020

Will curtailing early hiring/unraveling help diversity?

If you run a company that hires very early, you likely hire from familiar places.  If talented recruits from more diverse backgrounds are harder to identify very early, you might want to slow things down a bit.  Here's a WSJ story, about what might signal a change in the famously unraveled market for young analysts in private equity:


Blackstone to Bypass Scramble for Investment-Bank Talent in Bid to Diversify Hiring
On-campus recruiting will be expanded to 44 schools from nine in 2015
By Miriam Gottfried, June 24, 2020

"Blackstone Group Inc., ...one of the most coveted employers on Wall Street, is throwing out a key section of its recruiting playbook in a bid to improve its hiring process and increase diversity.

"The investing giant and its private-equity peers have long engaged in a yearly race to pluck junior investment bankers already trained in spreadsheet and PowerPoint wizardry from firms such as Goldman Sachs Group Inc. and Morgan Stanley. The prize for those lucky enough to make the jump: entry-level jobs that can pay as much as $300,000 a year at some firms.

"Now Blackstone officials say the firm plans to sit out that contest in favor of on-campus recruiting, already its main source of talent and one that it is expanding to bring in more candidates directly from schools, including historically black colleges and universities and women’s colleges. Blackstone, which has been working for years to extend its campus reach, says it will directly recruit from 44 schools this academic year. That is up from just nine in 2015.
...
"Blackstone, the largest buyout firm with $538 billion of assets, received nearly 15,000 applications for just 90 full-time analyst roles that started last year. It has two main sources of new junior talent: campuses and investment banks, which have their own hotly competitive entry-level hiring operations.

In the case of the latter, recruitment used to happen during the summer after applicants’ first year on the job, but it has steadily crept forward as private-equity firms jump the starting gun in hopes of securing the best candidates. In 2019, recruiting took place in September, just a couple months after candidates began working at banks—for roles that wouldn’t start until summer 2021."

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Here's an earlier related post (from long ago, before Covid-19 and George Floyd...):

Monday, December 9, 2019

Tuesday, July 7, 2020

Should deceased donors be allowed to donate sperm?

Deceased donor sperm donation is the subject of an article earlier this year, in light of the shortage of donated sperm in the UK:

Hodson N, Parker J. "The ethical case for non-directed postmortem sperm donation,"
Journal of Medical Ethics 2020;46:489-492.

Abstract: In this article we outline and defend the concept of voluntary non-directed postmortem sperm donation. This approach offers a potential means of increasing the quantity and heterogeneity of donor sperm. This is pertinent given the present context of a donor sperm shortage in the UK. Beyond making the case that it is technically feasible for dead men to donate their sperm for use in reproduction, we argue that this is ethically permissible. The inability to access donor sperm and the suffering this causes, we argue, justifies allowing access to sperm donated after death. Moreover, it is known that individuals and couples have desires for certain sperm donor characteristics which may not be fulfilled when numbers of sperm donors are low. Enacting these preferences contributes significantly to the well-being of intended parents, so we argue that this provides a pro tanto reason for respecting them. Finally, we explore the benefits and possible disadvantages of such a system for the various parties affected.

"The United Kingdom (UK) has a shortage of donor sperm. In 2016 there were 2273 donor insemination treatment cycles; 42% of the women registering had a male partner, 41% had a female partner and 17% were single.1 The average number of newly registered sperm donors per year between 2011 and 2013 was 586, an increase from 2004 where there were 237 donors.2 Yet this increase includes donations for specific use by a known individual to create one offspring. In 2016 the Human Fertilisation and Embryology Authority (HFEA) reported 4306 in vitro fertilisation (IVF) treatment cycles with ‘own eggs and donor sperm’ and 924 treatment cycles with ‘donor egg and donor sperm’.1 Clearly there is high demand for donor sperm and HFEA reports demonstrate this is increasing.1

"Commercial imports have been the mainstay of UK efforts to keep up with increasing demand for donor sperm.1 The Department of Health and Social Care estimates that 4000 samples were imported from the USA and 3000 from Denmark in addition to samples from other European Union (EU) countries.3 The HFEA highlights that imports are used to plug the gap because "the cost, time and resources required to recruit donors themselves is too high when there are specialist sperm banks who can carry out an efficient and reliable service".4 The Department of Health and Social Care has raised concerns that the UK's departure from the EU may worsen this state of affairs.3
...
"There are barriers to donating sperm in life that may prevent some men acting on their desire to help others or see their genes continue into future generations through donation. Posthumous sperm donation avoids most of these problems, allowing men to access the positives of sperm donation without the drawbacks. Living kidney donation provides an informative comparison between the motivations to donate in life versus after death. It is difficult to overestimate the value of donated kidneys to those individuals on the transplant list. Many people feel the pull of altruism and have a desire to help those who need a kidney transplant. Yet the potential costs of donating during life mean that individuals would rather donate after death when those costs are eliminated.16 Gamete donation after death parallels kidney donation by offering the same benefits as donation in life with fewer drawbacks, thereby both incentivising men to donate and providing greater opportunity to fulfil some of their reproductive and altruistic desires. This makes voluntary postmortem sperm donation an attractive addition to living donation.
...
"Given the potential impact of postmortem sperm donation on the family, policy decisions could be used to soften the implications of postmortem sperm donation for the family. For our purposes, the important point is that considerations of the family, including a romantic partner surviving the deceased man, do not justify a blanket ban on the use of sperm collected after death, especially if the donor has specified a desire to donate.
...
"The UK consensus is that gametes ought not to be bought although donor expenses should be covered.37 We do not take a view on this generally, but note the dissonance generated when sperm from countries such as Denmark where ‘vendors’ have been paid is used in the UK.38 In so far as society benefits from a coherent bioethical policy reflecting its shared values, using dead donors rather than donors who were paid in other countries to bolster supplies might provide a more coherent policy.

Monday, July 6, 2020

Netherlands now has opt out deceased donor registration

The Netherlands Times has the story:

NEW DONOR REGISTRY OPT-OUT RULE TAKES EFFECT TODAY
By Janene Pieters on Wednesday, 1 July 2020

"The Netherlands' new organ donation law takes effect today. From now on Dutch adults who haven't told the Donor Register their wishes for their organs after death will automatically be registered as "no objection to organ donation", instead of automatically being registered as a non-donor. This means their organs can go to a patient after their death, though their next of kin will first be consulted.
"According to the government, almost 7 million Netherlands residents have not registered their wishes with the Donor Register yet. They will be sent a letter, prompting them to do so. Residents of Noord-Holland will be the first to receive this letter in September and October. A second letter will be sent six weeks later. If no response is received after the two letters, the person will be registered as "no objection to organ donation".
"Of those who have registered their wishes with the Donor Register, 53 percent are registered as organ donors. About 36 percent are non-donors, and 11 percent decided to leave this decision up to their families. "
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In the U.S., almost 50% of drivers are registered donors, close to the Netherlands rate. But it looks like the 36 percent "non donors" have given a definite "no" to donation. It will be interesting to see how the deceased donor transplantation rate evolves in the Netherlands.

Sunday, July 5, 2020

Czech-Austrian and Swedish-Danish kidney exchange

Overcoming borders makes the market thicker.

Here's a paper on kidney exchange across between Austria and the Czech Republic from the most recent edition of Transplant International:

Crossing borders to facilitate live donor kidneytransplantation: the Czech-Austrian kidney paired donation program – a retrospective study 
Ondrej Viklicky1 , Sebastian Krivanec2 , Hana Vavrinova1 , Gabriela Berlakovich3 , Tomas Marada4 , Janka Slatinska1 , Tereza Neradova4 , Renata Zamecnikova4 , Andreas Salat3 , Michael Hofmann3 , Gottfried Fischer5 , Antonij Slavcev6 , Pavel Chromy4 , Rainer Oberbauer2 , Tomas Pantoflicek4 , Sabine Wenda5 , Elisabeth Lehner2 , Ingrid Fae5 , Paolo Ferrari7,8,9 , Jiri Fronek4 & Georg A. Bohmig

SUMMARY Kidney paired donation (KPD) is a valuable tool to overcome immunological barriers in living donor transplantation. While small national registries encounter difficulties in finding compatible matches, multi-national KPD may be a useful strategy to facilitate transplantation. The Czech (Prague) and Austrian (Vienna) KPD programs, both initiated in 2011, were merged in 2015. A bi-national algorithm allowed for ABO- and low-level HLA antibody-incompatible exchanges, including the option of altruistic donor initiated domino chains. Between 2011 and 2019, 222 recipients and their incompatible donors were registered. Of those, 95.7% (Prague) and 67.9% (Vienna) entered into KPD registries, and 81 patients received a transplant (95% 3-year graft survival). Inclusion of ABO-incompatible pairs in the Czech program contributed to higher KPD transplant rates (42.6% vs. 23.6% in Austria). After 2015 (11 bi-national match runs), the median pool size increased to 18 pairs, yielding 33 transplants (8 via cross-border exchanges). While matching rates doubled in Austria (from 9.1% to 18.8%), rates decreased in the Czech program, partly due to implementation of more stringent HLA antibody thresholds. Our results demonstrate the feasibility of merging small national KPD programs to increase pool sizes and may encourage the implementation of multi-national registries to expand the full potential of KPD.
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And here's a paper on kidney exchange between Sweden and Denmark:

De första njurbytena mellan två skandinaviska länder är gjorda
The first kidney exchanges between two Scandinavian countries are made
Scandinavian expansion of the renal exchange program STEP
Tommy Andersson, Professor, Lars Wennberg , Per Lindnér, Ilse Duus Weinreich, Karin Skov, Claus Bistrup

SUMMARY: The first kidney exchanges between two Scandinavian countries have been performed
This article describes the Scandinavian expansion of the previously described kidney exchange program STEP, and the first two exchanges performed between two Scandinavian countries late in 2019. All surgical procedures were performed simultaneously and / or coordinated at different hospitals in Scandinavia and the kidney grafts were transported between the participating units. Four weeks after surgery, all recipients had a good and stable kidney function and all donors had recovered.
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see earlier post:

Wednesday, December 25, 2019

Saturday, July 4, 2020

Stanford GSB highlights Akbarpour and van Dijk on the virtues of strategy-proof school choice


Here's an article on the Stanford GSB website, describing a paper by Mohammad Akbarpour and Winnie van Dijk:

How School Choice Systems Create Unfair Advantages
Lotteries for public school admissions unintentionally favor students who have the option to attend private institutions, a new study shows.
June 26, 2020|by Maggie Overfelt

And here's the paper that the article highlights:
School Choice with Unequal Outside Options
September 2018 Working Paper No. 3764
Students with identical valuations for public schools but unequal outside options have different opportunity costs of revealing their preferences. Consequently, manipulable mechanisms need not resolve conflicting preferences in a Pareto-improving manner. We show that when they do not, welfare improvements for students with outside options come at the expense of students without outside options. This result strengthens the argument that strategyproof mechanisms “level the playing field.” Our model predicts that students without outside options are more likely to strategize, consistent with recent findings in empirical studies of education markets.