Matching and market design in the latest GEB (stack overflow...)

 The current (January 2024) issue of Games and Economic Behavior presents an increasingly common dilemma (faced by scholars in burgeoning fields, and maybe by aging scholars...). Papers I should read are being written much faster than I can read them.

Here are 9 papers in that issue that are pretty clearly about matching and market design (which leaves out some papers on auctions and one on unraveling of the timing of markets) :

1. Obvious manipulations of tops-only voting rules

   R. Pablo Arribillaga, Agustín G. Bonifacio

   Pages 12-24

   View PDF

2. select article Rejection-proof mechanisms for multi-agent kidney exchange

   Research articleOpen access

   Rejection-proof mechanisms for multi-agent kidney exchange

   Danny Blom, Bart Smeulders, Frits Spieksma

   Pages 25-50

   View PDF

3. 1. Designing rotation programs: Limits and possibilities

      Ville Korpela, Michele Lombardi, Riccardo D. Saulle

      Pages 77-102

      View PDF

   2. select article School choice with transferable student characteristics

      Research articleOpen access

      School choice with transferable student characteristics

      Carmelo Rodríguez-Álvarez, Antonio Romero-Medina

      Pages 103-124

      View PDF

      Auction timing and market thickness

      Isaías N. Chaves, Shota Ichihashi

      Pages 161-178

      View PDF

      
      

      1. School choice with costly information acquisition

         Tyler Maxey

         Pages 248-268

         View PDF

      2. select article Singles monotonicity and stability in one-to-one matching problems

         Research articleOpen access

         Singles monotonicity and stability in one-to-one matching problems

         Yoichi Kasajima, Manabu Toda

         Pages 269-286

         View PDF

      3. select article Reallocation with priorities

         Research articleFull text access

         Reallocation with priorities

         Julien Combe, Jan Christoph Schlegel

         Pages 287-299

         View PDF

         
         

         Coalitional stability in matching problems with externalities and random preferences

         Adriana Piazza, Juan Pablo Torres-Martínez

         Pages 321-339

         View PDF

"Why Is There So Much Fraud in Academia?" Freakonomics interviews Max Bazerman and others

Below is the latest Freakonomics podcast (and transcript), on fraud in academia.  Those most in the headlines weren't available to be interviewed, but their coauthor (and my longtime HBS colleague) Max Bazerman gives his perspective.

Also interviewed are the Data Colada authors/data sleuths Leif Nelson,  Uri Simonsohn, and Joe Simmons (with some clues about the name of their blog), and Brian Nosek, who founded the prizewinning Center for Open Science (https://www.cos.io/ 

Here it is:

Why Is There So Much Fraud in Academia?  Some of the biggest names in behavioral science stand accused of faking their results. Freakonomics EPISODE 572.

######

And here are two paragraphs from Max's HBS web page (linked above), suggesting more to come:

"I have been connected to one of the most salient episodes of data fabrication in the history of social science – involving the signing first effect alluded to above. I am working on understanding all known social science frauds in this millennium. Social science also struggles with a broader problem, namely the fact that many studies fail to replicate due to faulty research practices that have become common in social science. Most replication failures can be traced back to the original researchers twisting their data to conform to their predictions, rather than from outright fraud. Trying to produce “significant” results, they may run a study multiple times, in a variety of ways, then selectively report the tests that worked and fail to report those that didn’t. The result is the publication of conclusions that do not hold up as accurate. Both problems – outright data fabrication and this reporting bias that shapes results – need to be tackled, so all of us in academia can publish results that are replicable and can help create value in society.

         "The last dozen years have witnessed multiple efforts to reform social science research to make it more credible, reproducible, and trusted. I am writing a book on reforming social science, which will provide an account of recent data fabrications, and highlight strategies to move forward to create more credible and impactful scientific research."

The Everything Token. By Steve Kaczynski and Scott Duke Kominers

 Here's a look into a possible future of the web (but it's still available in hardcover):

The Everything Token.  HOW NFTS AND WEB3 WILL TRANSFORM THE WAY WE BUY, SELL, AND CREATE.  By Steve Kaczynski and Scott Duke Kominers

"A Harvard Business School professor and a16z crypto research partner and a career marketer and Web3 entrepreneur demystify the coming digital revolution, showing how NFTs will transform our online and offline interactions."

“NFTs were a mystery to me. Thanks to this book, both the economics of NFTs and how businesses can use them are now in sharp focus and no longer mysterious. It helps, too, that the book was so much fun to read!”

— Paul Milgrom, Shirley and Leonard Ely Professor of Humanities and Sciences at Stanford University and Nobel Laureate in Economics"

“You can’t ask for savvier or more enthusiastic guides to the potential of NFTs than Kaczynski and Kominers.”
— Alvin E. Roth, Craig and Susan McCaw Professor of Economics at Stanford University and Nobel Laureate in Economics

###########

Earlier: 

Saturday, November 13, 2021

Non-fungible tokens (NFTs), in Harvard Business Review, by Kaczynski and Kominers

Medical aid in dying, and slippery slopes--the debate in Britain

 The Oxford blog Practical Ethics considers medical aid in dying (MAID), and the slippery slope arguments that accompany current debates on the subject in Britain.

Medical assistance in dying: what are we talking about? By Alberto Giubilini, Oxford Uehiro Centre for Practical Ethics

"Medical assistance in dying  – or “MAiD”,  to use the somehow infelicitous acronym – is likely to be a central topic in bioethics this year. That might not be true of bioethics as an academic field, where MAiD has been widely discussed over the past 40 years. But it is likely true of bioethics as a wider societal and political area of discussion. There are two reasons to think this.  First, the topic has attracted a lot of attention the last year, especially with “slippery slope” concerns around Canada’s policies. Second, MAiD has recently been in the news in the UK, where national elections will take place in 2024.  It is not hard to imagine it will feature in the heated political polarization that always accompanies election campaigns

...

"Canada is often taken as the best example in support of ‘slippery slope’ arguments against legalizing MAiD. According to these arguments, even assuming MAiD was acceptable in some form, legalization would open the door to clearly wrong or problematic practices down the line. For instance, legalizing physician-assisted suicide in cases of “unbearable suffering” for someone whose death is reasonably foreseeable in the short term might lead to relaxing our attitudes towards MAiD for those suffering only from mental illness. In the bioethics literature, slippery slope arguments against MAiD have often been put forward and traditionally been dismissed as fallacious, overly cautious, or easily addressable (for an overview and a critical appraisal, see Fumagalli 2020).  However, contrary to the prevailing view, they are not necessarily fallacious in nature (Walton 1992). To many people, Canada is a case in point, calling for a more nuanced take.

"Canada started off by decriminalizing medical assistance in dying in 2016. In 2019, the Superior Court of Quebec found the “reasonable foreseeability of natural death” unconstitutional as an eligibility criterion for MAiD. The criterion was removed in 2021, making MAiD available for patients without terminal illness. From March 2024, patients suffering solely from mental illness will also be able to legally access MAiD. According to Government data, nearly 45,000 people died through MAiD in Canada from 2016 to 2022. Between 2020 and 2022, the number of requests for MAiD increased on average by 28% per year. At the same time, the number of patients found ineligible consistently declined from 8% in 2019 to 3.4% in 2022.

...

"One question is about whether suicide is morally permissible. As mentioned, many religious  and non religious views consider suicide in most cases morally impermissible. However, the moral impermissibility of suicide is not a decisive reason against legalizing MAiD. More important is whether suicide is a right and, if so, what type of right it is. That is a different type of question, because arguably we often have the right to do morally wrong things (Waldron 1982). I might have a right to kill myself even if suicide is morally wrong.

...

"I have not provided any answer to any of these questions here. I just want to point out that some of the differences in ethical and religious views about suicide or about the right to end one’s own life are less relevant to a debate on MAiD than one might initially assume.

"At the same time, many concerns around slippery slopes are more relevant than one might initially assume. As a matter of fact and of logic, MAiD legislations tend to expand by extending their eligibility criteria. When debating MAiD legislations, we need to ask if we are prepared for that."

Slippery slope

 A slippery slope is a metaphor sometimes used to oppose a change that may seem good in itself, but might lead to further changes that we would regret.  The metaphor is that we are perched on a high plateau, and any attempt to move higher might (even if initially successful), cause us to plunge into the abyss.

The perspective is different if instead we're at a low place, trying to get higher, but we keep backsliding because the slope is slippery.

Pope Francis calls for a ban on surrogacy

 The Catholic Church has long opposed in-vitro fertilization (IVF), one of the technological tools that allows surrogacy, on the grounds that IVF produces more embryos than are brought to term as babies, and so is comparable to abortion.*  But this week, during his annual "state of the world" foreign policy speech, Pope Francis made clear that he thinks surrogacy should additionally be banned because of the presence of "commercial contracts." 

Here's the story from the National Catholic Register:

Pope Francis Calls Surrogacy ‘Deplorable,’ Calls for Global Ban in Speech to Ambassadors

"Pope Francis called surrogacy “deplorable” and called for a global ban on the exploitative practice of “so-called surrogate motherhood” in a speech to all of the world’s ambassadors to the Vatican on Monday.

“The path to peace calls for respect for life, for every human life, starting with the life of the unborn child in the mother’s womb, which cannot be suppressed or turned into an object of trafficking,” Pope Francis said Jan. 8.

“In this regard, I deem deplorable the practice of so-called surrogate motherhood, which represents a grave violation of the dignity of the woman and the child, based on the exploitation of situations of the mother’s material needs. A child is always a gift and never the basis of a commercial contract.”

"The Pope then called on the international community to prohibit the practice of surrogacy universally."

##########

The United States Conference of Catholic Bishops reiterates the main point in this quote from its spokesperson:

Statement of USCCB on Holy Father’s Remarks on Surrogacy, January 8, 2024

“As Pope Francis stated, with surrogacy, an unborn child is turned into ‘an object of trafficking’ because it exploits the birth mother’s material needs and makes the child the product of a commercial contract. This is why the Catholic Church teaches that the practice of surrogacy is not morally permissible. Instead, we should pray for, and work towards, a world that upholds the profound dignity of every person, at every stage and in every circumstance of life.”

##########

And here's the story in the NYT:

Francis Urges Ban on Surrogacy, Calling It ‘Despicable’  The pope said that an unborn child must not be “turned into an object of trafficking,” expanding his condemnation of a practice already illegal in Italy and some other European countries.  By Jason Horowitz

"Pope Francis on Monday called surrogate motherhood a “despicable” practice that should be universally banned for its “commercialization” of pregnancy, including the practice among wars, terrorism and other threats to peace and humanity in an annual speech to ambassadors.

...

"Surrogacy is already illegal in Italy and compensated surrogacy is also illegal or restricted in much of Europe. The United Kingdom, the Netherlands, Portugal and several other nations allow surrogacy under certain conditions. Paid surrogacy is legal in some European nations, including Ukraine, Russia and Belarus.

"Surrogate mothers in the United States and Canada are often hired by Europeans, including same-sex couples, seeking to have children..."

##########

Earlier:

Wednesday, April 5, 2023  Surrogacy under siege in Italy

*  Monday, October 4, 2010  From repugnant transaction to Nobel Prize in Medicine

#########

Update: here's the Pope's full speech (in English) from the Vatican Press Office:

Audience with the Diplomatic Corps accredited to the Holy See for the exchange of greetings for the New Year, 08.01.2024

Brain death for organ donation, and its relation to controversy about abortion

 Here's a summary of the current discussion of brain death (and its possible connection to the debate on whether a fetus is a living person), in JAMA. Maybe it will reach some resolution this year...

Truog, Robert D., and David C.  Magnus. The Unsuccessful Effort to Revise the Uniform Determination of Death Act. JAMA. 2023;330(24):2335–2336. doi:10.1001/jama.2023.24475

"In 1968, a Harvard committee proposed a new approach for determining death, one based on the irreversible loss of neurological functions.1 This concept was instantiated into law in 1980 when the Uniform Law Commission endorsed The Uniform Determination of Death Act.2 The act, which a large majority of states have adopted in whole or with some variations, says, in part, that an individual is dead if the individual has sustained (1) irreversible cessation of circulatory and respiratory functions, or (2) irreversible cessation of all functions of the entire brain, including the brain stem. A determination of death must be made in accordance with accepted medical standards.

"In 2020, the commission was asked to consider updating the act, based in part on concerns that the act does not fully align with current medical practice.3 A draft of its revision was presented and discussed at the commission’s annual meeting on July 26, 2023.4 Herein, we summarize the major issues that led to the decision to draft a revision, the alternatives that were considered, why there was failure to reach consensus, and what this means for the future.

"The Uniform Determination of Death Act defines neurological death, commonly known as brain death, as the complete absence of all functions of the entire brain. The current diagnostic criteria, however, test for only a subset of brain functions, and most notably do not include testing for neurosecretory hypothalamic functions, which are retained by many patients who have been diagnosed as brain dead.5 In addition, the law requires the “irreversible” cessation of biological functions, whereas in practice the standard has been “permanence,” with the distinction being that irreversible implies that the function cannot be restored, whereas permanence means that the function will not be restored because no attempt will be made to do so.

...

"n order for medical practice to be in compliance with the law, the commissioners considered either changing the guidelines to conform with the law, or changing the law to conform with the guidelines. Under the first approach, the guidelines would require physicians to diagnose the irreversible cessation of all brain functions, not just selected functions. This would be challenging, given the difficulty of detecting and measuring all of the brain’s many functions. Alternatively, the law could be revised to be coherent with current practice guidelines. At the annual meeting of the Uniform Law Commission, the committee considered the following draft alternative to the existing Uniform Determination of Death Act4: “An individual is dead if the individual has sustained: (1) permanent cessation of circulatory and respiratory functions; or (2) permanent (A) coma, (B) cessation of spontaneous respiratory functions, and (C) loss of brainstem reflexes.”

"This proposal would harmonize the law with the practice guidelines. Instead of requiring the absence of all brain functions, this revision would have required only the absence of specific brain functions, namely the capacity for consciousness and spontaneous respiration.

"The proposed revision also would have replaced the requirement for irreversible cessation with permanent cessation, thereby anticipating the trajectory of new developments in resuscitation research, including work demonstrating the potential for restoration of neuronal function in brains, even many hours after the loss of brain perfusion.6 Using the permanence standard, death can be determined in these patients on the grounds that function will not be restored rather than the requirement that it cannot be restored.

"Finally, the proposed revision also included a section that would have required hospitals to respect the refusal of patients or their surrogates to having death determined by neurological criteria. This position was supported by various constituencies, including the Catholic Medical Association, as well as several of the Uniform Law Commission commissioners, who saw it as a way to respect the diversity of opinions surrounding the determination of death while still supporting the concept of brain death. At the same time, this approach was strongly condemned by most mainstream physician and transplant organizations, given the burden that it would place on hospitals and intensive care units and its potential negative impact on organ procurement.

...

"in an email on September 22, 2023, the committee leadership announced that they had decided to pause the process, saying that “although we will continue to hope mid-level principles will become apparent, no further drafting committee meetings will be scheduled at this time.”

"Perhaps this outcome could have been predicted from the beginning, given the polarization that has evolved in the US around issues at the beginning and end of life. Commissioner James Bopp emphasized these connections in asserting that the controversies around brain death and abortion are an “identical debate, just in a different context.”7

###########

Earlier:

Wednesday, October 18, 2023

Peter Singer on brain death

"Scraping poison off the bone": Transplants in China without organs from executed prisoners

 Following a long period in which the bulk of China's organ transplants used organs from executed prisoners, there have been steady efforts to create a system of voluntary deceased donation comparable to that in most of the world where transplants are done.

Global Times has the latest bit of that evolving story:

China’s organ donation to be more transparent under newly issued rules By Zhao Yusha and Zhang Yuying   Dec 15, 2023

"Chinese Premier Li Qiang has signed a decree of the State Council to unveil rules on human organ donation and transplantation, media reported on Thursday, with Chinese experts noting that the country’s organ donations will be more transparent under the regulation, which reflects great determination in China's organ donation reform. 

The newly issued rules, which will take effect on May 1, 2024, have been refined from the ones on human organ transplantation issued in 2007 to meet the demands of changing situations and ensure the healthy development of the cause, according to the Xinhua News Agency.

The rules strengthen the publicity and guidance of organ donation. Besides, the regulations stipulate that organ donation must adhere to the principles of voluntary and unpaid participation, and the conditions and procedures of donation should be improved based on the Civil Code. 

...

"China’s organ donations will be more transparent under the newly issued rules, Huang Jiefu, chairman of China Human Organ Donation and Transplantation Committee and chair of the China Organ Transplant Development Foundation Advisory Board, told the Global Times on Thursday.

"Huang noted that the revision of the rules shows the great determination in China's organ donation reform, which he described as scraping poison off the bone. “The regulations reflect the importance the Party and country attach to organ donation, which provides a strong legal guarantee for the high-quality development of organ donation cause.” 

"According to the rules, the application management of organ transplantation technologies should be improved to ensure medical quality. Specifically speaking, the rules define the conditions that medical institutions and practicing physicians must possess when engaging in organ transplantation, and require regular evaluation of the clinical application capabilities of relevant technologies in medical institutions. 

...

"In addition, the rules improve related provisions on legal liabilities and strengthen the punishment of malpractice in the field, Xinhua reported.

"Experts said the new rules call for more people to get involved in organ donations and transplants, and it is hoped that China's organ transplantation technology will spread to more countries in the future."

********

Here (in Chinese, but with Google Translate) is the announcement from Xinhua News Agency

李强签署国务院令 公布《人体器官捐献和移植条例》"Li Qiang signed a State Council order announcing the "Regulations on Human Organ Donation and Transplantation"

[The new regulations] "stipulate that patients whose spouses, direct blood relatives and other relatives have donated deceased organs can apply for organ transplantation , priority is given to them under the same conditions. 

...

"Ethical review requirements before organ harvesting will be refined, and the witnessing procedures for harvesting organs from deceased persons will be stipulated. Improve the cadaver organ distribution system, stipulate that the distribution of cadaver organs should meet medical needs, follow the principles of fairness, impartiality, and openness, and distribute uniformly through the distribution system established by the health department of the State Council. It is required to regularly announce the donation and distribution of cadaver organs and accept social supervision.

...

"In addition, relevant provisions on legal liability have been improved, penalties have been increased, and illegal activities in the field of organ donation and transplantation have been severely cracked down on.

　　"(Authorized release) Order No. 767 of the State Council of the People's Republic of China

　　"(Authorized release) Regulations on Human Organ Donation and Transplantation"

HT: Michelle Miao

Market Design for Surface Water , by Ferguson and Milgrom

 The potential market for surface water is a market in which any transfer of rights involves externalities affecting the water consumption of others.

Market Design for Surface Water  by Billy A. Ferguson & Paul Milgrom, NBER WORKING PAPER 32010, DOI 10.3386/w32010, December 2023

Abstract: Many proposed surface water transfers undergo a series of regulatory reviews designed to mitigate hydrological and economic externalities. While these reviews help limit externalities, they impose substantial transaction costs that also limit trade. To promote a well-functioning market for surface water in California, we describe how a new kind of water right and related regulatory practices can balance the trade-off between externalities and transaction costs, and how a Water Incentive Auction can incentivize a sufficient number of current rights holders to swap their old rights for the new ones. The Water Incentive Auction adapts lessons learned from the US government’s successful Broadcast Incentive Auction.

From the introduction:

"Why is there so little water trading in California despite the heterogeneous uses and huge price differences? The consensus among many economists studying water is that much of the problem lies in an archaic system of property rights, which was perhaps simple and clear enough to function well when California was first settled, but which is dysfunctional today. We will argue below that trading in traditional water rights creates externalities, so efficiency-enhancing changes in water allocations cannot be achieved by exhausting profitable bilateral trades. Rather, it requires a coordinated, multilateral effort. The next section on the Institutional Background provides a description of water rights and the externalities that can result from trade or from certain other decisions about uses. What is most novel in this paper comes after that: we analyze a mechanism that enacts a change in water rights that could lead to much more efficient trade.

Our analysis draws on lessons learned from the US Broadcast Incentive Auction in 2016-17, in which some rights to use radio spectrum for television broadcast were combined, converted, and subdivided into more flexible rights that were better suited for wireless broadband communications. This was accomplished using an auction procedure designed to provide an “incentive” for broadcasters to participate. As in that auction, participation in an analogous Water Rights Incentive Auction could be entirely voluntary, with current water users incentivized to participate because they could trade their existing rights for new, more flexible rights and possibly additional payments as determined by an auction. Just as the Broadcast Incentive Auction achieved its goals described in the National Broadband Plan even though many broadcasters chose not to sell their rights, a Water Incentive Auction could provide the substantial benefits of more flexible water rights even if many water users decline to participate. We describe some details of a possible Water Incentive Auctions in a later section of this paper."

Matching Markets and Inequality, in Exeter in June: call for papers

 Here's the announcement and call for papers:

Matching Markets and Inequality Workshop, Department of Economics University of Exeter Business School June 20-21, 2024

Keynote speakers: Pierre-André Chiappori, Leeat Yariv, Christopher Neilson

Coalition to Modify NOTA (the National Organ Transplant Act of 1984)

 Elaine Perlman forwards the following discussion points:

Coalition to Modify NOTA Talking Points

modifyNOTA.org

What is the Coalition to Modify NOTA proposing? The Coalition to Modify NOTA proposes providing a $50,000 refundable tax credit to remove all disincentives for American non-directed kidney donors who donate their kidney to a stranger at the top of the kidney waitlist in order to greatly increase the supply of living kidney transplants, the gold standard for patients with kidney failure.

What is the value of a new kidney? The value of a new kidney, in terms of quality of life and future earnings potential, is between $1.1 million and $1.5 million.

What is the American kidney crisis? Fourteen Americans on the waiting list for a kidney transplant die each day. That number does not include the many kidney failure patients who are not placed on the waiting list but would have benefited from a kidney transplant if we had no shortage. The total number of Americans with kidney failure will likely exceed one million by 2030. 

Why not rely on deceased donor kidneys to end the shortage? A living kidney transplant lasts on average twice as long as a deceased donor kidney. Fewer than 1 in 100 Americans die in a way that their kidneys can be procured. Currently, the 60% of Americans who are registered as deceased donors provide kidneys for 18,000 Americans annually. Even if 100% of Americans agreed to become organ donors, this would raise donations by only about 12,000 per year. In the USA, 93,000 Americans are on the kidney waitlist. A total of 25,000 people are transplanted annually, two-thirds from deceased donors and one-third from living donors. The size of the waitlist has nearly doubled in the past 20 years, while the number of living donors has not increased.

What is the extra value that non-directed kidney donors provide? Non-directed kidney donors often launch kidney chains that can result in a multitude of Americans receiving kidneys. Fewer than 5% of all living kidney donations are from non-directed kidney donors who are an excellent source of organs for transplantation because they are healthier than the general population. 

 

How much does the taxpayer currently spend on dialysis? Kidney transplantation not only saves lives; it also saves money for the taxpayer. The United States government spends nearly $50 billion dollars per year (1% of all $5 trillion collected in annual taxes) to pay for 550,000 Americans to have dialysis, a cost of approximately $100,000 per year per patient, a treatment that is far more expensive than transplantation.

 

How many more lives will be saved with the refundable tax credit for non-directed donors? The number of non-directed donors increased from 18 in 2000 to around 300 each year. After our Act becomes law, we estimate that we will add approximately 7,000 non-directed donor kidneys annually. That is around 70,000 new transplanted Americans by year ten. 

 

How much tax money will be saved once the Act is passed? The refundable tax credit will greatly increase the number of living donors who generously donate their kidneys to strangers. We estimate that in year ten after the Act is passed, the taxpayers will have saved $12 billion. 

 

What is a refundable tax credit? A refundable tax credit can be accessed by both those who do and those who do not pay federal taxes. 

 

What do Americans think about compensating living kidney donors? Most Americans favor compensation for living kidney donors  to increase donation rates. 

 

Who is able to donate their kidneys?  Donation requires potential organ donors to undergo a comprehensive physical and psychological evaluation, and each transplant center has its own rigorous criteria. Only around 5% of those who pursue evaluation actually end up donating, and only about one-third of Americans are healthy enough to be donors. Providing financial incentives will encourage more Americans to donate their kidneys to help those with kidney failure.

 Do kidney donors currently have expenses that result from their donation? The medical costs of donation are covered by the recipients' insurance, but donors are responsible for providing for the costs of their own travel, out-of-pocket expenses, and lost wages. Programs like the federal NLDAC and NKR's Donor Shield can help offset these costs, making donation less expensive.

Is it moral to compensate kidney donors? Compensation for kidney donors can be viewed as a way to address the current kidney shortage and save lives. Americans are compensated for various forms of donation such as sperm, eggs, plasma, and surrogacy, all of which involve giving life. 

How long do we need to compensate living kidney donors? Compensation should continue until a xenotransplant or advanced kidney replacement technology becomes available. In the meantime, it's crucial to prevent further loss of lives due to the shortage.

 Will incentivizing donors undermine altruism?  Financial compensation for donors can coexist with altruism. Donors can opt out of the funds from the tax credit or choose to donate those funds to charity. The majority of donors support financial compensation, and relying solely on altruism has led to preventable deaths.

 In addition to ending the kidney shortage, what are other benefits of the Act? The Act can help combat the black market for kidneys and reduce human trafficking because we will have an increased number of transplantable kidneys. It can also motivate individuals to become healthier to pass donor screening, potentially further reducing overall healthcare costs.

 Why provide non-directed donors with a refundable tax credit of $50,000? The compensation is designed to attract those who are both healthy and willing to donate. Given the commitment, time, and effort involved in the donation process, this compensation recognizes the value of those who save lives and taxpayer funds.

 When more donors step forward, can transplant centers increase the number of surgeries?  There is considerable unused capacity at most U.S. transplant centers, and increasing the number of donors is likely to lead to more surgeries. The goal is to perform more kidney transplants and reduce the waitlist, benefiting patients in need.

 In what way does the Act uphold The Declaration of Istanbul?  While the Act deviates from one principle of the Declaration of Istanbul by offering compensation, it aligns with the other principles and is expected to standardize compensation and reduce worldwide organ trafficking.

 What about dialysis as an alternative to transplant?  Dialysis, while a treatment option, can be a challenging and uncomfortable process for patients. For those who could have been transplanted if there were no kidney shortage, dialysis can result in needless suffering and an untimely death.

 Why not compensate living liver donors? Liver donation is riskier and not as cost-effective as kidney donation. While the Act currently focuses on kidney donors, it's possible that compensation for liver donors could be considered in the future.

 What about the argument that providing an incentive to donate will exploit the donors, especially low income donors? 

Primarily middle and low income kidney failure patients are dying due to the kidney shortage. People with lower incomes tend to have social networks with fewer healthy people because health is related to income level. In addition, being placed on a waitlist often costs money. Kidney donation also costs money, an estimated 10% of annual income. The refundable tax credit will help low income donors and recipients the most by making donation affordable and increasing the number of kidneys for those waiting the longest on the waitlist, frequently middle and low income Americans. The tax credit aims to help those most affected by the kidney shortage, as poorer and middle-income individuals often bear the brunt of the kidney crisis’s consequences. The Act will level the playing field, making it easier for those at all income levels to receive a life-saving kidney. 

Please examine this chart:

 

Topics in Market Design: Econ 287/365: Winter quarter, Itai Ashlagi

Itai Ashlagi will be teaching Econ 287 this quarter, on topics in market design.  It's highly recommended.

He writes that the syllabus below is very tentative, and will depend in part on how many of the enrolled students took Econ 285 (Ostrovsky and Roth) in the Fall (back in 2023:-)

Topics in Market Design 2024, Itai Ashlagi

Market design is a field that links the rules of the of the marketplace to understand frictions, externalities and more generally economic outcomes. The course will provide theoretical foundations on assignment and matching mechanisms as well as mechanism design. There will be emphasis on theories at the intersection of economics, CS and operations as well as applications that arise in labor markets, organ allocation, platforms.

The class will further expose students to timely market design challenges and will we will host a few guest lectures. The class offers an opportunity to begin a research project. Students will reading critique papers, present papers and write a final paper.

Lectures: Monday 10:30am-1:20pm Shriram 052

Course requirements: (i) reading and writing critiques about papers, (ii), presenting papers in class, and (iii) a term paper.

Instructor: Itai Ashlagi. iashlagi@stanford.edu

Some potential papers for presenting:

Equity and Efficiency in Dynamic Matching: Extreme Waitlist Policies, Nikzad and Strack.

Eliminating Waste in Cadaveric Organ Allocation, Shi and Yin

Pick-an-object mechanisms, Bo and Hakimov

Monopoly without a monopolist, Huberman, Leshno and Moallemi

The College Portfolio Problem, Ali and Shorrer

Equal Pay for Similar Work, Passaro, Kojima, and Pakzad-Hurson

Auctions with Withdrawal Rights: A Foundation for Uniform Price, Haberman and Jagadessan.

Optimal matchmaking strategy in two-sided marketplaces, Shi

Practical algorithms and experimentally validated incentives for equilibrium-based fair division (ACEEI),

Budish, Gao, Othman, Rubinstein

Congestion pricing, carpooling, and commuter welfare, Ostrovsky and Schwarz

Artificial intelligence and auction design, Banchio and Skrzypacz

Selling to a no-regret buyer, Braverman et al.

Dynamic matching in overloaded waiting lists, Leshno

The regulation of queue size by levying tolls, Naor

Optimal search for the best alternative, Weitzman

Whether or not to open Pandora’s box, Doval

Descending price optimally coordinates search, Kleinberg, Waggoner, Weyl

Market Failure in Kidney Exchange? Nikhil Agarwal, Itai Ashlagi, Eduardo Azevedo, Clayton Featherstone and Omer Karaduman

Choice Screen Auctions, Michael Ostrovsky

Incentive Compatibility of Large Centralized Matching Markets, Lee

Tentative schedule:

Week 1: Two-sided matching, stability and large markets.

Week 2: One-sided matching, duality, optimization and constraints.

Week 3: Multi-item auctions, auction design, revenue equivalence, optimal auctions, interdependent

valuations.

Week 4: Congestion, dynamic matching.

Week 5: Waitlists, search and learning.

Week 6: Foundations of mechanism design.

Week 7: Robustness in implementation

Weeks 8-10: Projects

We will host several guest lectures. Presentations of papers will take place throughout the course.

Background references

1. List of (mostly applied) papers are given in a separate document.

2. Books

Roth, Alvin E.and Marilda A. Oliveira Sotomayor, Two-sided matching: A study in game-theoretic modeling and analysis. No. 18. Cambridge University Press, 1992.

Vijay Krishna, Auction Theory, 2010.

Tilman Borgers, An Introduction to Mechanism Design by Tilman Borgers.

Milgrom, Paul, Putting Auction Theory to Work, 2004.

3. Papers

(a) Introduction

Roth, Alvin E. The Economist as Engineer: Game Theory, Experimentation, and Computation as Tools for Design Economics. Econometrica, 70(4), 2002. 1341-1378.

Klemperer, Paul, What Really Matters in Auction Design?, Journal of Economic Perspectives, 16(1): 169-189, 2002.

Weitzman, Martin, Is the Price System or Rationing More Effective in Getting a Commodity to Those Who Need it Most?, The Bell Journal of Economics, 8, 517-524, 1977.

(b) Stable matching and assignment

Gale, David and Lloyd Shapley, College Admissions and the Stability of Marriage, American Mathematical Monthly, 69: 9-15,1962.

Roth and Sotomayor, Chapters 2-5.

Hylland, Aanund, and Richard Zeckhauser. The efficient allocation of individuals to positions, The Journal of Political Economy, 293-314,1979.

Roth, Alvin E., The Evolution of the Labor Market for Medical Interns and Residents: A Case Study in Game Theory. Journal of Political Economy, 92: 991-1016, 1984.

Kojimam, Fuhito and Parag A. Pathak. Incentives and stability in large two-sided matching markets. American Economic Review, 99:608-627, 2009

Abdulkadiroglu, Atila and Tayfun Sonmez. School choice: A mechanism design approach. American Economic Review, 93:729-747, 2003.

Abdulkadiroglu, Atila , Parag A. Pathak, and Alvin E. Roth. The New York City high school match. American Economic Review, 95:364-367, 2005.

Ashlagi, Itai, Yash Kanoria, and Jacob D. Leshno. Unbalanced random matching markets: The stark effect of competition, Journal of Political Economy,

Ashlagi, Itai and Peng Shi. Optimal allocation without money: An engineering approach. Management Science, 2015.

Peng Shi and Nick Arnosti. Design of Lotteries and Waitlists for Affordable Housing Allocation, Management Science, 2019.

Peng Shi, Assortment Planning in School Choice, 2019.

Ashlagi, Itai, and Afshin Nikzad. What matters in tie-breaking rules? how competition guides design, 2015.

(c) Auctions and revenue equivalence

Myerson, Roger Auction Design, Mathematics of Operations Research, 1981.

Milgrom, Paul. Putting Auction Theory to Work. Chapter 2-3.

W. Vickrey, Counterspeculation, auctions, and competitive sealed tenders, The Journal of Finance, 16(1) 8–37, 1961.

R. Myerson, Optimal auction design, Mathematics of Operations research, 1981.

J. Bulow and J. Roberts, The simple economics of optimal auctions, Journal of Political Economy, 1989.

J. Bulow and P. Klemperer, Auctions vs negotiations, American Economic Review, 1996.

P.R. McAfee and J. McMillan, Auctions and bidding, Journal of Economic Literature 1987.

P. Milgrom and R. Weber, A theory of auctions and competitive bidding, Econometrica, 1982.

Roth, A. E. and A. Ockenfels, Late-Minute Bidding and the Rules for Ending Second-Price Auctions: Evidence from eBay and Amazon.” American Economic Review, 92(4): 1093-1103, 2002.

(d) Mechanism design

Vickrey, William (1961): Counterspeculation, Auctions and Competitive Sealed Tenders. Journal of Finance, 16(1): 8-37.

Ausubel, Larry and Paul Milgrom, The Lovely but Lonely Vickrey Auction. in Cramton et. al Combinatorial Auctions, 2005.

J.C. Rochet, A necessary and sufficient condition for rationalizability in a quasi-linear context”, 1987.

K. Roberts, The characterization of implementable choice rules”, 1979.

F. Gul and E. Stacchetti, Walrasian equilibrium with gross substitutes, Journal of Economic Theory, 1999.

I. Ashlagi, M. Braverman, A,. Hassidim and D. Monderer, Monotonicity and implementability, Econometrica, 2011.

(e) Dynamic mechanism design and dynamic pricing

G. Gallego and G. Van Ryzin, Optimal dynamic pricing of inventories with stochastic demand over finite horizons. Management science, 40(8), 999-1020, 1994.

S. Board and A. Skrzypacz, Revenue management with forward-looking buyers, Unpublished manuscript, Stanford University,2010.

A. Gershkov, B. Moldovanu, P. Strack, Revenue Maximizing Mechanisms with Strategic Customers and Unknown, Markovian Demand

D. Bergemann and J. Valimaki, The dynamic pivot mechanism, Econometrica, 2010.

A. Gershkov and B. Moldovanu, Dynamic Revenue Maximization with Heterogeneous Objects: A Mechanism Design Approach, 168-198, 2009.

F. Gul, H. Sonnenschein, R. Wilson, Foundations of dynamic monopoly and the Coase conjecture, J. of Economic Theory, 1986.

D. Besanko and W. L. Whinston, Optimal price skimming by a monopolist facing rational consumers, Management Science, 1990.

(f) Dynamic matching

Itai Ashlagi and Alvin E. Roth. New challenges in multihospital kidney exchange. American Economic Review, 102:354-359, 2012

Nikhil Agarwal, Itai Ashlagi, Eduardo Azevedo, Clayton Featherston and Omer Karaduman. Market Failure in Kidney Exchange, 2018.

Anderson, R., Ashlagi, I., Gamarnik, D. and Kanoria, Efficient Dynamic Barter Exchange, Operations Research, 2015.

Mohammad Akbarpour, Shengwu Li, and Shayan Oveis Gharan. Dynamic matching market design. JPE, 2019.

Baccara, Mariagiovanna, SangMok Lee, and Leeat Yariv, Optimal dynamic matching, 2015.

Jacob Leshno, Dynamic Matching in Overloaded Waiting Lists, 2017.

Pilot projects to speed deceased donor organ allocation

I won't use the word "experiments" for fear of the evil eye, but the OPTN is planning to authorize 'pilot programs' to try to speed the allocation of deceased donor organs. The idea is that after an organ has been rejected numerous times, and has started to be in danger of discard, it can be offered to a transplant center and patient that are likely to accept and transplant it, rather than proceeding to offer it to centers and patients in priority order. This is important, because too much waiting time on ice is one of the chief reasons that organs are rejected and eventually discarded.

Expedited Placement Variance his proposal recommends a new variance related to expedited organ placement and proposes modifying the OPTN’s variance process in order to allow for more rapid studies of potential improvement.

"Proposed changes

"Create a variance to govern pilot projects related to expedited organ placement.

Gives the OPTN Executive Committee authority to develop protocols for expedited organ placement.

This approach will allow the OPTN the ability to rapidly iterate on different protocols.

Update portions of the OPTN’s governance structure regarding variances.

This will allow for a more rapid and iterative approach when creating new variances."

Read the full proposal (PDF)

"The task force intends to conduct multiple iterative pilots or PDSAs with the community to identify effective practices to improve the efficiency of the organ allocation process. (Not all pilots or PDSAs will require a policy variance.) This proposal 1) creates a variance to govern the expedited placement pilots and 2) adjusts the OPTN’s governance of all variances. Additional variances or process improvement projects will focus on other topics to improve the efficiency of the organ allocation process.

"The Committee is issuing this proposal for a thirty-day public comment period, which is shorter than the usual public comment period. This is to allow the variance to take effect sooner than the end of regular public comment but allow the community time to comment on the proposed variance. It also is in line with the public comment periods for emergency and expedited policy changes."

What's ahead for U.S. organ allocation in the coming year

 Here's the December announcement from HRSA of their plans for reforming organ procurement and allocation this year.  

Organ Procurement and Transplantation Network (OPTN) Modernization Initiative. HRSA's approach to securing best-in-class expertise and an independent Board of Directors, December 2023 Updates

"At every step of the modernization process, HRSA has been committed to robust competition for the first-ever multi-vendor solicitations for OPTN contracts, and we were pleased that Congress supported our vision for fundamental reform through passage of the bipartisan Securing the U.S Organ Procurement and Transplantation Network Act. For more than a year, we have pursued a fundamental sea change in how the OPTN operates in order to improve the performance, transparency, independence, and accountability of this life-saving system for patients – the first time in the nearly 40-year history of this program that any Administration has advocated for this type of fundamental reform to break up the monopoly. Below is an update on the progress made to date and details regarding next steps. 

...

"A key element of HRSA’s OPTN Modernization Initiative is the President’s Fiscal Year 2024 Budget proposal to more than double investment in organ procurement and transplantation with a $36 million increase over Fiscal Year 2023 for a total of $67 million. In light of the uncertainty regarding full-year appropriations for Fiscal Year 2024, as well as the upcoming holidays and HRSA’s commitment to providing at least 60 days for potential bidders to respond to solicitations, HRSA plans to issue the solicitations in January 2024.

...

"1. Launching an Independent OPTN Board of Directors

"Current practice: For nearly 40 years, the Board of Directors for the Organ Procurement and Transplantation Network (OPTN) has been comprised of the same individuals who serve as the Board of Directors for the private entity that has held the OPTN contract. No formal requirements existed to protect against conflicts of interest resulting from this shared role.

"Under HRSA’s OPTN Modernization Initiative:

"HRSA will issue a solicitation in January 2024 for independent non-profit organizations to bid on supporting an independent OPTN Board of Directors in order to ensure mission-driven governance, strong conflict of interest policy, and that the system remains a public good not a private asset. The organization awarded the OPTN Board Support Contract will not be awarded any other OPTN contract.

...

"2. Robust Competition for First Ever Multi-Vendor Solicitations to Support Best-in-Class Vendors for OPTN IT, Operations, Communications, Research and Evaluation

"Current practice: Across the nearly 40-year history of the OPTN, all functions of the OPTN have been managed by a single vendor and not competed based on technical expertise in areas like IT or operations. This does not serve patients well and does not allow the system to keep pace with modern technology.  

"Under HRSA’s OPTN Modernization Initiative:

"Phase 1 — Competitive Transition Contracts:

"In January 2024, HRSA will release solicitations open to all non-profit and for-profit organizations for proposals for OPTN work related to information technology management, operations, data analytics/research, and communication.

"These contracts will support the transition from the legacy OPTN system to a modernized system and approach while ensuring uninterrupted access to the organ matching system and related processes in order to support transplantation and prevent unnecessary risk while protecting patients. As such, we refer to them as Competitive Transition Contracts.

...

"Phase 2 — Next Gen Contracts:

"In Summer 2024, HRSA will issue solicitations open to all non-profit and for-profit organizations for proposals for the OPTN Next Gen contracts.

"The Next Gen contracts will prioritize human-centered design practices and will focus on developing a truly modern organ matching technology solution that is highly reliable, secure, and user-friendly."

######

So the plan is to start this month with bids for contracts to manage the transition from the current system to the 'next generation' system, and to follow those in the summer with bids to design the next generation system. (If that seems out of order to you, you're not the only one.)

Market design for the environment, by Cantillon and Slechten

 Here's a recent NBER working paper, to start the year off on an optimistic note:

MARKET DESIGN FOR THE ENVIRONMENT, by Estelle Cantillon and Aurélie Slechten, NBER Working Paper 31987, http://www.nber.org/papers/w31987

Abstract: The main argument in favor of markets in environmental contexts is the same as in other contexts: their ability to promote efficient allocations and production. But environmental problems bring their own challenges: their underlying bio-physical processes - and the technologies to monitor them - constrain what is feasible or even desirable. This chapter illustrates the main design dimensions in environmental markets, the trade-offs involved and their impact on performance, through the lens of a regulated market for pollution rights (the EU emissions trading scheme) and a voluntary market for the provision of environmental services (the global market for carbon credits). While both markets eventually contribute to climate change mitigation, their organisation as a “pollution market”, for the former, and as a “provision market”, for second, means that different design considerations take precedence. Both markets also face challenges: volatile prices in the EU emissions scheme and low trust for voluntary carbon markets. We discuss how alternative design options could address those.

From the Introduction:

"This chapter reviews existing and developing uses of markets for natural capital from a market design perspective. We first provide a typology of environmental problems for which markets can provide a solution. This leads us to distinguish between overexploitation, degradation and underprovision problems. Overexploitation and degradation problems happen when the goods and services provided by Nature are not excludable and property rights are shared or nonexistent. Underprovision problems arise when the natural resource, over which well-established access and usage rights exist, creates positive externalities for agents who do not benefit from any property rights to the resource. We argue that each natural resource is characterized by its specific bio-physical process which constrains the definition of what can be traded and the choice of design to support the goals of the market.

"We illustrate these considerations in the context of climate change mitigation, where compliance markets for emissions reduction and voluntary carbon markets are playing an increasingly important role. The history of the EU emissions trading scheme over the past 20 years illustrates how apparently small design decisions can impact the performance of a market and the challenges of generating an informative and stable price signal, an important desideratum to foster cost efficiency. The current discussions around the integrity of voluntary carbon markets show the importance of the definition of what is traded, and how technology and nature constrain it."