Market design comes to the "new new economic sociology" (and vice versa)

 In the Journal of Cultural Economy, sociologists reflect on their involvement with engineers in a project to integrate wind-generated electricity in Denmark.

Ossandón, J., & Pallesen, T. (2025). The new new economic sociology – the market intervention test. Journal of Cultural Economy, 1–21. https://doi.org/10.1080/17530350.2025.2451252 

 

ABSTRACT: "This paper explores what happens when the ‘new new economic sociology’ – the figure created with Callon’s importation of ANT to the study of markets – intervenes in market interventions. Empirically, the paper examines a situation in which a researcher moves out of her habitual position of studying economists and engineers doing markets, to instead take part in an effort of engineering a market. The paper has two contributions. One is analytical. We propose a framework to inspect that special constrained situation in which the new new economic sociology coexists with market design. The second contribution is more practical. We hope what we propose in this paper, will help others in a similar situation to understand the particular direction of their intervention. "

Is market design insidious?

 Is market design not just performative, but insidious?  Here's a paper arguing that might be the case.

Nik-Khah, E. (2025). Platforming economics: tech economics, market design, and the transformation of markets. Journal of Economic Methodology, 1–21. https://doi.org/10.1080/1350178X.2025.2470267 

ABSTRACT: Economic methodologists join economists in crediting market designers for taking a pragmatic approach toward improving markets for the common good. Accordingly, the new wave of market design, designated ‘tech economics,’ now accepts responsibility for pursuing efficiency, as well as a myriad of other policy goals. Yet, ambiguity surrounds the targets they hold out for intervention and therefore the justifications they have offered for the continued deployment of their designs. By scrutinizing the theoretical and practical features of these designers’ ‘markets,’ this paper finds that market designers have offered to assist platforms in extending their domains of governance. While this stance has opened up multitudes of design opportunities, the attendant conceptual shift raises questions not only about the activities undertaken by specific tech economists, but more generally about the plausibility of the economist’s professed stance to improve markets for the benefit of all.

Maybe this discussion could benefit from a Bond-style villain?

"The designer’s chief exponent was, of course, Alvin Roth"

###########

This strikes me as a conversation worth having (and I'll be happy to play myself when it is turned into a movie...)

Donald Shoup (1938-2025) led the war on (too much) free parking

 Here's his WSJ obit:

Donald Shoup, a Parking Guru Who Reshaped the Urban Landscape, Dies at 86
An economist at UCLA, Shoup said free parking carries a high cost, which is borne by everybody, By Jon Mooallem 

“Nothing is more pedestrian than parking,” he often joked. Everyone else is focused on traffic, Shoup told the website Streetsblog. “I thought I could find something useful if I studied what cars do for 95 percent of the time, which is park.”

...

"In the mid-1960s, he was working in Midtown Manhattan while completing a Ph.D. at Yale and suddenly noticed a paradox he couldn’t make sense of as an economist, but which everyone took for granted as human beings. Up and down West 44th Street, “almost all cars were parking for free on some of the most valuable land on earth,” Shoup recalled on the “Curb Enthusiasm” podcast. 

...

“We have expensive housing for people, and free parking for cars! We have our priorities the wrong way around,” Shoup cried out...

 ...

“A surprising amount of traffic isn’t caused by people who are on their way somewhere,” Shoup concluded in a 2007 New York Times opinion column. “Rather, it is caused by those who have already arrived.” 

...

"Shoup’s policy prescriptions were straightforward: Get rid of minimum parking requirements; bring the price of on-street parking in line with demand, enough to maintain one or two empty spots on every block; and funnel the resulting revenue into upkeep and other public services for the immediate area, creating what Shoup called a “parking benefit district,” to bring residents and local businesses on board.

"There were already some successful test cases of these reforms when “The High Cost of Free Parking” was published, most notably in Pasadena, Calif., where reinstalling parking meters was key to revitalizing a historic shopping district. And Shoup considered the proposals in his book so sensible and self-evident that, he later recalled, he naively assumed his vision would immediately become a reality. “I thought the world would change next month,” he told the podcast, “The War on Cars.”

#######

HT: Atila Abduldakiroglu 

The NBER celebrates market design

 From the NBER Reporter:

Working Group Report: Market Design  By Michael Ostrovsky and Parag A. Pathak

Here are the introductory paragraphs (after which the report goes on to survey various areas of market design research).

"The Market Design Working Group, established in 2009 under the leadership of Susan Athey and Parag Pathak, is a preeminent research forum in the field of market design. The working group meets annually, alternating between Cambridge, Massachusetts, and Palo Alto, California, to present research that bridges theoretical economics and practical applications, all focused on what The Economist aptly characterized as “an intelligently designed invisible hand.”1 Research in market design has been celebrated in academic circles, as evidenced by recognitions like the 2012 Nobel Prize for work on matching markets and the 2020 Nobel Prize for auction theory, and has also been instrumental in catalyzing tangible reforms in real-world institutions and markets.

"One feature that sets market design apart from much of traditional economic theory is its unwavering commitment to practical applications. Market designers have developed a unique professional profile, equally at home in university lecture halls, hospital surgery wards, school committee meetings, and the boardrooms of technology companies. This versatility allows them to translate complex economic models and analyses into solutions for real-world problems. The field’s research has informed an impressive range of applications across various sectors of society. "

Sessions that caught my eye in the ASSA program

Economics of Higher Education

Lightning Round Session

 Saturday, Jan. 4, 2025   8:00 AM - 10:00 AM (PST)

 Hilton San Francisco Union Square, Golden Gate 3

Hosted By: American Economic Association

• Chair: Caroline Hoxby, Stanford University

Cap-and-Apply: Unintended Consequences of College Application Policy in South Korea

Taekyu Eom

, 

SUNY-Buffalo

 

•  View Abstract

 

College Course Shutouts

Kevin Mumford

, 

Purdue University

Richard Patterson

, 

Brigham Young University

Anthony Yim

, 

Brigham Young University

 

•  View Abstract
 
•  Download Preview (PDF, 3.27 MB)

Do Double Majors Face Less Risk? An Analysis of Human Capital Diversification

Andrew S. Hanks

, 

Ohio State University

Shengjun Jiang

, 

Wuhan University

Xuechao Qian

, 

Stanford University

 

Bo Wang

, 

Nankai University

Bruce A. Weinberg

, 

Ohio State University

•  View Abstract

 

Inequality-Aware Market Design

Paper Session

 Sunday, Jan. 5, 2025   10:15 AM - 12:15 PM (PST)

 Hilton San Francisco Union Square, Union Square 1 and 2

Hosted By: Econometric Society

• Chair: Piotr Dworczak, Northwestern University

Waiting or Paying for Healthcare: Evidence from the Veterans Health Administration

Anna Russo

, 

Massachusetts Institute of Technology

 

•  View Abstract

Optimal Redistribution via Income Taxation and Market Design

Mohammad Akbarpour

, 

Stanford University

Pawel Doligalski

, 

University of Bristol

Piotr Dworczak

, 

Northwestern University

 

Scott Duke Kominers

, 

Harvard University

•  View Abstract

Should the Government Sell You Goods? Evidence from the Milk Market in Mexico

Diego Javier Jimenez Hernandez

, 

Chicago Federal Reserve

 

Enrique Seira

, 

Michigan State University

•  View Abstract

Taxing Externalities without Hurting the Poor

Mallesh M. Pai

, 

Rice University

Philipp Strack

, 

Yale University

 

•  View Abstract

Discussant(s)

Vasiliki Skreta

, 

University of Texas-Austin and University College London

Dmitry Taubinsky

, 

University of California-Berkeley

Mohammad Akbarpour

, 

Stanford University

Dan Waldinger

, 

New York University

 

 

Market Design in College Admissions

Paper Session

 Sunday, Jan. 5, 2025   10:15 AM - 12:15 PM (PST)

 Hilton San Francisco Union Square, Union Square 11

Hosted By: Econometric Society

• Chair: Evan Riehl, Cornell University

College Application Mistakes and the Design of Information Policies at Scale

Anaïs Fabre

, 

Toulouse School of Economics

Tomas Larroucau

, 

Arizona State University

Christopher Andrew Neilson

, 

Princeton University

Ignacio Rios

, 

University of Texas-Dallas

 

•  View Abstract

Inequity in Centralized College Admissions with Public and Private Universities: Evidence from Albania

Iris Vrioni

, 

University of Michigan

 

•  View Abstract

Stakes and Signals: An Empirical Investigation of Muddled Information in Standardized Testing

Germán Reyes

, 

Middlebury College

Evan Riehl

, 

Cornell University

 

Ruqing Xu

, 

Cornell University

•  View Abstract
 
•  Download Preview (PDF, 1.12 MB)

 

Finance and Development

Paper Session

 Sunday, Jan. 5, 2025   1:00 PM - 3:00 PM (PST)

 Hilton San Francisco Union Square, Continental Ballroom 9

Hosted By: American Economic Association

• Chair: Martin Kanz, World Bank

Default Contagion in Microfinance

Natalia Rigol

, 

Harvard Business School

Ben Roth

, 

Harvard Business School

 

•  Hide Abstract

Abstract

Joint liability is one of the hallmarks of microfinance. Though it is intended to reduce non-payment, it has also been hypothesized to lead to default contagion, whereby non-payment by one borrower may reduce the likelihood of repayment by groupmates. Utilizing unexpected deaths, we document significant default contagion in one of Chile's largest microfinance institutions. We estimate that a single default causes an additional 0.8 borrowers to default, indicating that nearly half of observed default is due to contagion. 

Credit Contracts, Business Development, and Gender: Evidence from Uganda

Selim Gulesci

, 

Trinity College Dublin

 

Francesco Loiacono

, 

European Bank for Reconstruction and Development

Miri Stryjan

, 

Aalto University

Andreas Madestam

, 

Stockholm University

•  View Abstract

Discrimination Expectations in the Credit Market: Survey Evidence from India

Stefano Fiorin

, 

Bocconi University

Joseph Hall

, 

Stanford University

Martin Kanz

, 

World Bank

 

•  View Abstract

Discussant(s)

Simone Gabrielle Schaner

, 

University of Southern California

Anna Vitali

, 

New York University

Janis Skrastins

, 

Washington University-St. Louis