New York Stock Exchange fined for market design flaws

The WSJ has the story:
NYSE to Pay $14 Million Over 2015 Trading Malfunctions
Settlement covers series of glitches that disrupted trading on three occasions that year

"The New York Stock Exchange agreed Tuesday to pay $14 million to settle regulatory investigations into a series of market malfunctions and technical errors that disrupted trading on three occasions in 2015.

"The settlement represents the first case in which the Securities and Exchange Commission accused a stock exchange of violating rules established to prevent outages of critical market infrastructure. The SEC also faulted NYSE for using unapproved “price collars” to damp price swings during a wild trading session on Aug. 24, 2015, which had the unintended effect of exacerbating volatility.
...
"Chaotic trading on the morning of Aug. 24, 2015, exposed flaws in the way U.S. stocks and exchange-traded funds trade and prompted criticism of the NYSE’s unusual market design, in which human traders on an old-fashioned trading floor coexist with electronic trading. Critics of NYSE’s model said human traders, given discretion to set the opening price of stocks, made things worse.

"The many price swings that morning triggered nearly 1,300 halts of stocks and ETFs. Many shares didn’t formally open for trading until 9:45 a.m. or, in some cases, after 10 a.m., as the NYSE’s market makers struggled to find valid starting prices for stocks.

"During the upheaval, dozens of ETFs traded at sharp discounts to the sum of their holdings, worsening losses for fundholders who sold during the panic."

Solidarity between doctors and nurses in Quebec

Canadian doctors--at least some of them--are different.
The Washington Post has the story.

Hundreds of Canadian doctors demand lower salaries

"In a move that can only be described as utterly Canadian, hundreds of doctors in Quebec are protesting their pay raises, saying they already make too much money.

"As of Wednesday afternoon, more than 700 physicians, residents and medical students from the Canadian province had signed an online petition asking for their pay raises to be canceled. A group named Medecins Quebecois Pour le Regime (MQRP), which represents Quebec doctors and advocates for public health, started the petition Feb. 25.

“We, Quebec doctors who believe in a strong public system, oppose the recent salary increases negotiated by our medical federations,” the petition reads in French.

"The physicians group said it could not in good conscience accept pay raises when working conditions remained difficult for others in their profession — including nurses and clerks — and while patients “live with the lack of access to required services because of drastic cuts in recent years.”

"A nurses union in Quebec has in recent months pushed the government to address a nursing shortage, seeking a law that would cap the number of patients a nurse could see. The union said its members were increasingly being overworked, and nurses across the province have held several sit-ins in recent months to push for better working conditions."

Kidney exchange for cats

When you read about a kidney transplant for a cat (see below), you might wonder about the kidney donor.  It turns out the transplant involved a living-donor kidney donation in exchange for a home and a life saving rescue from an animal shelter (in which un-adopted animals are euthanized):

Here's the Baltimore Sun:

A $19,000 kidney transplant for a 17-year-old cat? His Baltimore owner says it was money well spent

"Not quite four months ago, Betsy Boyd spent 41 percent of her annual salary on a kidney transplant for her ailing 17-year-old cat, Stanley.

As a condition of the $19,000 surgery, she also adopted the kidney donor, a 2-year-old tabby named Jay"

Tech Times tells us more about the donor Jay:

"Boyd was able to save the life of Stanley, but in the process, also saved the life of another cat.

"One of the conditions of the kidney transplant procedure was that Boyd would have to adopt the cat that donated the kidney to Stanley. The cat was named Jay, a 2-year-old cat who was rescued from the streets and was in a shelter.

"We are just as concerned with the life of the donor as the recipient," said Dr. Lillian Aronson from the Ryan Veterinary Hospital at the University of Pennsylvania. "They are saving another animal's life and we owe it to them to save their life and give them a good home."

Boyd not only gave Stanley more years at life, but she also gave Jay a new home."
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I don't know if there are journals that publish papers on Veterinary Ethics, but if there are, I anticipate heated discussion of the ethics of kidney donation in exchange for being saved from a shelter.  (Authors will speak with certainty both for and against.)

The fact that most shelters euthanize animals who don't find a home fairly quickly is another issue that arouses some repugnance and controversy: e.g. here's a statement from PETA on why they support that practice:
 ‘No-Kill’ Label Slowly Killing Animals

Another New Federal Law Clerk Hiring (Pilot) Plan

Future law clerks who are already in their second or third year of law school have already been hired, but here's a plan to defer the hiring of those who just entered law school this year.  It will have implications for hiring starting in 2019, and again in 2020, after which it will be reviewed. (This will be the seventh such attempt to halt unraveling in this market since 1983.) The attempt to ban exploding offers is new...

The DC Circuit publishes the following announcement:
Notice of Adoption of the New Federal Law Clerk Hiring Plan
February 2018


"Federal Law Clerk Hiring Plan

Starting with students who entered law school in 2017, the application and hiring process will not begin until after a law student’s second year.

For students who entered law school in 2017 (graduating class of 2020): Judges will not seek or accept formal or informal clerkship applications, seek or accept formal or informal recommendations, conduct formal or informal interviews, or make formal or informal offers before June 17, 2019.

For students who enter law school in 2018 (graduating class of 2021): Judges will not seek or accept formal or informal clerkship applications, seek or accept formal or informal recommendations, conduct formal or informal interviews, or make formal or informal offers before June 15, 2020.

A judge who makes a clerkship offer will keep it open for at least 48 hours, during which time the applicant will be free to interview with other judges.

This is a two-year pilot plan. Participating judges will reconsider their participation after June 2020. A copy of the plan will be posted on the OSCAR website at https://oscar.uscourts.gov/federal_law_clerk_hiring_pilot."
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And it is now indeed on the OSCAR site: Federal Law Clerk Hiring Pilot

[OSCAR--the Online System for Clerkship Application and Review-- is a web based platform for the law clerk job market.]

HT: Kim Krawiec

Unrecognized Single-Gender Social Organizations (USGSO) at Harvard

Harvard has taken steps to express its repugnance to single-gender social organizations. It is motivated primarily by repugnance to male-only groups, and seeks to recognize that some women-only groups were formed in response to discrimination. Here is their new policy, which is short of a ban on students who participate in such groups, but which imposes sanctions on such students. (The organizations themselves are typically privately owned and outside of Harvard's control).

Unrecognized Single-Gender Social Organization (USGSO) Policy

"Policy: Students matriculating in the fall of 2017 and thereafter who become members of Unrecognized Single-Gender Social Organizations (USGSO) will not be eligible to hold leadership positions in recognized student organizations or on athletic teams. In addition, such students will not be eligible for fellowships administered by the Office of Undergraduate Research and Fellowships. This policy does not apply to students who matriculated prior to fall 2017.
...
"Women’s Organizations: We are committed to treating all organizations that are moving towards gender-inclusivity fairly and to offering them Harvard College resources and assistance regardless of gender. As Dean Khurana noted in an open letter in May 2016, Harvard has a long and complex history of grappling with gender discrimination. The College is deeply committed to gender equity, inclusion, and non-discrimination and to advance women's full participation in Harvard's academic and extracurricular life. To that end, we welcome all organizations, and especially those whose membership is currently restricted to women, to partner with us.  We are excited to announce that Heidi Wickersham, Program Manager at the Harvard College Women’s Center, and staff members in the Office of Student Life will jointly partner with groups wishing to transition from having a women’s exclusive membership while maintaining a women’s-focused mission."

Deceased kidney allocation in Australia

What does it mean for kidney allocation to be fair?  A recent paper asks that question in Australia, and supplies some background to the debate in the increasing age of both patients and donors there.

Fairness in Deceased Organ Matching
Nicholas Mattei, Abdallah Saffidine, Toby Walsh

Abstract: "As algorithms are given responsibility to make decisions that impact our lives, there is increasing awareness of the need to ensure the fairness of these decisions. One of the first challenges then is to decide what fairness means in a particular context. We consider here fairness in deciding how to match organs donated by deceased donors to patients. Due to the increasing age of patients on the waiting list, and of organs being donated, the current “first come, first served” mechanism used in Australia is under review to take account of age of patients and of organs. We consider how to revise the mechanism to take account of age fairly. We identify a number of different types of fairness, such as to patients, to regions and to blood types and consider how they can be achieved."

Introduction: "Kidney disease costs the Australian economy billions of dol-lars per year. Over ten thousand people in Australia are on dialysis,  each  costing  hundreds  of  thousands  of  dollars  in medical and welfare costs. Australia is especially challenged in this area as kidney disease is a major problem within the indigenous population. The incidence of end stage kidney disease in the indigenous population in remote areas of Australia is 18 to 20 times higher than that of comparable non-indigenous peoples.1

"A  significant  trend  in  Australia  (as  in  other  developed countries) is that age is now starting to play a major role in kidney disease. It is impacting both the demand and supply side of the kidney transplant market. On the demand side,the age of patients in Australia waiting to receive a kidney has increased significantly in recent years. In 2010, for example, just 11% of the waiting list were 65 years or older. In 2015, this had increased to 15%. Over the next 30 years, the proportion of the population of Australia aged over 65 years is predicted to double to around 25 per cent. This ageing demographic will likely further increase the age of people on the waiting list for a kidney transplant.

"On the supply side of the market, the age of donated kidneys has also increased significantly. In 1989, the mean age of  donated  kidneys  in  Australia  was  just  32  years  old.  In 2014, this had increased dramatically to 46 years old. Surgeons are now able and willing to transplant older kidneys into older patients. In 1989, the oldest transplanted kidney came from a donor aged 69 years. In 2014, this has increased to an 80 year old donated organ. A number of factors including  increasing  life  expectancy,  medical  advances,  and  improved road safety have been driving these changes on both sides of the market."
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(The paper proposes a stability criterion that I'm not persuaded is well motivated in the present context, but the discussion is interesting...)

First kidney exchange in West Virginia

Another first, not in a far off land, but in West Virginia:
 Doctors Perform First Kidney Swap in West Virginia
West Virginia has the highest rate of kidney failure in the country

"thanks to two Cleveland Clinic surgeons and the transplant team at Charleston Area Medical Center (CAMC), whose Kidney Transplant Center is affiliated with Cleveland Clinic, they completed West Virginia’s first-ever paired kidney exchange, or “kidney swap.”

The Economist discusses repugnant transactions

It's good to see repugnant transactions and forbidden markets making it into the (semi-)popular press.  Here's an article from The Economist, in part about my presidential address at the American Economic Association meetings in January.

Economists cannot avoid making value judgments
Lessons from the “repugnant” market for organs

It's nice to be quoted, not so nice to be misunderstood. Here's a sentence in which I object to the words "but mostly."

"Repugnance, he laments, tilts the political playing field against ideas that unlock the gains from trade. He recommends that economists spend more time thinking about such taboos, but mostly because they are a constraint on the use of markets in new contexts."

In fact I think that repugnant transactions are important for social scientists to study. (By "repugnant transactions" I mean transactions that some people would like to engage in while others think they should be forbidden, and for which there are no easily measurable negative effects on non-participants.)   For example, when you see laws all over the world against compensating kidney donors, it suggests that there are widespread perceptions that we economists would do well to understand, because understanding how and why markets enjoy social support is important.

Of course, repugnance sometimes constrains markets in ways that I regret. But not always: I'm not in favor of bringing back indentured servitude, for example.

Some of the misunderstanding of my talk seems to stem from how it was blogged about and live tweeted by Professor Beatrice Cherrier, of whom the Economist says

"But, as Beatrice Cherrier of the Institute for New Economic Thinking argued in an essay addressing Mr Roth’s lecture, these questions are fundamental to economics. The hard sciences deal much better with the ethical implications of their work, she says. And moral concerns affect human behaviour in economically important ways, as Mr Roth found to his frustration. To be useful, economists need to learn to understand and evaluate moral arguments rather than dismiss them."

She blogs as The Undercover Historian, and you can read her take on my lecture at the link below (worth reading, but she certainly never talked to me about what I think, and seems to me to have heard what she came to hear, rather than what I said...)

Not going away: on Al Roth’s 2018 AEA Presidential Address and the ethical shyness of market designers  Posted on January 7, 2018


You can hear (and see) my talk for yourself here:

AEA Presidential Address - Marketplaces, Markets and Market Design
Alvin E. Roth, introduced by Olivier Blanchard
View Webcast

I certainly don't dismiss repugnance: I wish I understood it better. You can see some of the things I'd like to understand by looking at my posts about repugnance on this blog. (As I write this, I see that I have 921 posts tagged with the label "repugnance")

I should add that I am often disappointed in the ethics literature that tries to address the appropriate scope of markets, and of economic transactions.  Much of it seems deaf to the idea that there may be tradeoffs that need to be considered when we contemplate public policies. You don't have to be a strict utilitarian to think that sometimes it may be reasonable to tolerate a small amount of harm in order to relieve a large amount of harm. (See my recent posts about harm reduction.)

In some organ transplantation circles, the version of the trolley problem that strikes a chord has to do with the universal agreement that if a hospital has eight patients facing imminent death due to lack of available organs, you still can't order a pizza and murder the delivery man for his organs, so that there will be one death instead of eight.

But some of the discussion in the ethics literature, which concludes that most attempts to increase transplants are ethically suspect, reminds me of a recent New Yorker cartoon. The picture shows what looks like a board of directors meeting, and the man at the head of the table asks
"Yes, it would save many lives. But to what end?"

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Update: The Economist strikes back, see

Monday, May 7, 2018

I am slandered (or at least misunderstood) by The Economist for writing about repugnant transactions

You would think that writers for a magazine/newspaper called The Economist would read some economics before writing about it.

A liver for a kidney?

One consequence of the growth of kidney exchange is that there is more discussion of novel modes of exchange. Here's an article forthcoming in the American Journal of Transplantation that cautiously discusses the ethical issues that would be involved in a kidney-liver exchange.  I found the most interesting of the issues discussed to be those surrounding the excuse that medical teams give to prospective donors who don't really want to donate: they say e.g. that the kidney isn't suitable, or that the donor's kidney function isn't sufficient to allow him/her to donate. So the article discusses how this might pressure a reluctant donor if the question "but how about his/her liver"? could be asked...

The main case being discussed of course is one in which two lives could be saved by an exchange of donors, as in kidney exchange (or liver exchange, as has been employed a bit in Asia...).

(Incidentally, the article is written in the future hypothetical, but I wouldn't be shocked to hear that somewhere in the U.S. one such exchange has already taken place.)

New in the AJT:

A Liver for a kidney: Ethics of trans-organ paired exchange

Authors

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• Accepted manuscript online: 14 February 2018 
• DOI: 10.1111/ajt.14690
• American Journal of Transplantation (forthcoming)
• Abstract
• Living donation provides important access to organ transplantation, which is the optimal therapy for patients with end-stage liver or kidney failure. Paired exchanges have facilitated thousands of kidney transplants and enable transplantation when the donor and recipient are incompatible. However, frequently willing and otherwise healthy donors have contraindications to donation of the organ that their recipient needs. Trans-organ paired exchanges would enable a donor associated with a kidney recipient to donate a lobe of liver and a donor associated with a liver recipient to donate a kidney. This paper explores some of the ethical concerns that trans-organ exchange might encounter including unbalanced donor risks, the validity of informed consent, and effects on deceased organ donation.

Liver exchange: prospects and challenges

Might liver exchange be attempted in the U.S.?  (Maybe at Penn?). Here's a forthcoming article that considers how the challenges would be similar and different from the development of kidney exchange.

Liver Paired Exchange: Can the Liver Emulate the Kidney?
by Ashish Mishra, Alexis Lo, Grace S. Lee, Benjamin Samstein, Peter S. Yoo, Matthew H. Levine, David S. Goldberg, Abraham Shaked, Kim M. Olthoff, Peter L. Abt
Liver Transplantation, Accepted manuscript online: 10 February 2018

Abstract: Kidney paired exchange (KPE) constitutes 12 percent of all living donor kidney transplants in the United States. The success of KPE programs has prompted many in the liver transplant community to consider the possibility of liver paired exchange (LPE). Though the idea seems promising, the application has been limited to a handful of centers in Asia.  In this manuscript we consider the indications, logistical issues, and ethics for establishing a LPE program in the United States with reference to the principles and advances developed from experience with KPE. 

Auctions and Market Design Section of INFORMS

Martin Bichler writes:

We are excited about the successful formation of the Auctions and Market Design Section of INFORMS! Please visit and bookmark the INFORMS Auctions and Market Design homepage.

Events organized by the new INFORMS Section in 2018 include:

Cluster on Auctions and Market Design at the INFORMS Annual Meeting Nov. 4-7, 2018 in Phoenix, Arizona

As in the last few years, the cluster (previously the Auctions Cluster) will be chaired by Bob Day. Please email Bob at robert.day@uconn.edu if you are interested in being a session chair or want to have him find a spot for you in a session.  Please try to respond in the next two weeks (by March 4) to assure your session. Later requests by individual authors will be considered, but the sooner the better to lock in a slot.

Workshop on Mathematical Optimization in Market Design
June 18-19, 2018, Gates Hall, Cornell University, Ithaca, NY (co-located with ACM EC 2018)

We are pleased to announce a new focused workshop co-located with and immediately preceding ACM EC 2018. The workshop will have invited speakers from academia and industry including Itai Ashlagi (Stanford), Peter Cramton (Cologne), Scott Kominers (Harvard), Sébastien Lahaie (Google), Sasa Pekec (Duke), Tuomas Sandholm (CMU), and many more.

The final program and registration will be online end of March at the event website. Please direct questions to Martin Bichler (bichler@in.tum.de).

Section Officers:

• President: Robert Day, School of Business, University of Connecticut
• Vice-President: Martin Bichler, Department of Computer Science, Technical University of Munich
• Secretary: Ben Lubin, School of Business, Boston University
• Treasurer: Thayer Morill, Department of Economics, NC State University

Advisory Board

• Itai Ashlagi, Management Science and Engineering, Stanford University
• Karla Hoffman, School of Engineering, George Mason University
• Paul Milgrom, Department of Economics, Stanford University
• Sasha Pekec, School of Business, Duke University
• Al Roth, Department of Economics, Stanford University
• Tuomas Sandholm, Department of Computer Science, Carnegie Mellon University

Justice and Game Theory: DOJ inaugurates Jackson-Nash Address

Here's the announcement of a new lecture series at the U.S. Department of Justice Antitrust Division, the home of many fine economists with long government service.

Antitrust Division Establishes the “Jackson-Nash Address” and Announces Professor Alvin Roth as Inaugural Speaker

Professor Alvin Roth, Nobel laureate in economics, will address Antitrust Division attorneys, economists, and invited guests on Monday, Feb. 26, 2018.

The Antitrust Division is pleased to announce the establishment of the Jackson-Nash Address, and to announce that Professor Alvin Roth, the McCaw Professor of Economics at Stanford University, will be the inaugural speaker.  Professor Roth is the 2012 winner of the Nobel Prize for Economics for the theory of stable allocations and the practice of market design, and the author of “Who Gets What and Why.”  He will deliver his address on February 26, 2018, at The Great Hall, The Robert F. Kennedy Building, Department of Justice, 950 Pennsylvania Avenue NW, Washington, DC, at 2:00 p.m.

“The goals of the Jackson-Nash Address series are to recognize the contributions of former Supreme Court Justice Robert H. Jackson and Nobel Laureate economist John Nash, and to honor the speaker, recognizing and celebrating the role of economics in the mission of the Division,” said Assistant Attorney General Makan Delrahim.  “Professor Roth’s important contributions to game theory and market design make him an exemplary inaugural speaker.”

Justice Jackson served as Assistant Attorney General of the Antitrust Division prior to his appointment to the Supreme Court.  During his tenure at the Division, he set the stage for the expanded role of economics in antitrust, replacing vague legal standards with the “protection of competition” as the goal of antitrust law.

Professor John Nash’s research has provided the Division’s economists with the analytic tools necessary to protect competition.  In particular, Professor Nash’s strategic theory of games and his axiomatic bargaining model have had a profound effect on the Division’s enforcement mission.  The Division’s economists commonly rely on these theories to guide investigations and to help evaluate the effects of mergers, monopolization, and collusion.  

Non-Division attendees must enter through the entrance between 10th and Constitution Avenue, NW, and clear building security.  Any inquiries regarding security and logistics should be directed to Jeremy Edwards in the Office of Public Affairs at (202) 514-2007 or jeremy.m.edwards@usdoj.gov.
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Update: Assistant Attorney General Makan Delrahim Delivers Remarks for the Inaugural Jackson-Nash Address

Appreciations of Paul Milgrom from the CME-MSRI prize ceremony

Here is a link if you can't activate the video above.

I blogged about the prize here.

Debt traps and money lending

Credit for poor borrowers is a subject of importance in both the developing and developed world. Here's a new paper...

Debt Traps? Market Vendors and Moneylender Debt in India and the Philippines

Dean Karlan, Sendhil Mullainathan, Benjamin N. Roth

NBER Working Paper No. 24272
Issued in February 2018
NBER Program(s):Development Economics, Law and Economics, Productivity, Innovation, and Entrepreneurship 

A debt trap occurs when someone takes on a high-interest rate loan and is barely able to pay back the interest, and thus perpetually finds themselves in debt (often by re-financing). Studying such practices is important for understanding financial decision-making of households in dire circumstances, and also for setting appropriate consumer protection policies. We conduct a simple experiment in three sites in which we paid off high-interest moneylender debt of individuals. Most borrowers returned to debt within six weeks. One to two years after intervention, treatment individuals were borrowing at the same rate as control households.

SITE experimental economics conference, August 2018, call for papers

Call for Papers

SITE Experimental Economics Conference

August 6 - 7, 2018

  

The Stanford Institute for Theoretical Economics: Workshop in Experimental Economics will be hosted this year on August 6th and 7th at Stanford University.  

The workshop seeks to showcase recent contributions in experimental economics. We hope you will consider submitting your work, and encourage others with interesting work to do so as well.

The deadline for submission is April 1, 2018.  To submit a paper, please follow the instructions at the following link:  https://site.stanford.edu/call-papers.  The submission platform this year requires you to create an account. While this platform is outside of our control, if you have any difficulty with the online submission, please feel free to email your paper directly to Christine (clexley@hbs.edu) or to the SITE program coordinator, Dorian (siteworkshop@stanford.edu).

SITE Experimental Economics Organizers

Luke Coffman, Harvard University

Christine Exley, Harvard Business School

Muriel Niederle, Stanford University

Al Roth, Stanford University 

Lise Vesterlund, University of Pittsburgh

Kidney exchange in India

Right now, kidney exchange in India is all done in single transplant center programs. Here's an article advocating inter-hospital exchange to increase accesss to transplantation.

Kidney-paired donation to increase living donor kidney transplantation in India: Guidelines of Indian Society of Organ Transplantation – 2017
Kute VB, Agarwal SK, Sahay M, Kumar A, Rathi M, Prasad N, Sharma RK, Gupta KL, Shroff S, Saxena SK, Shah PR, Modi PR, Billa V, Tripathi LK, Raju S, Bhadauria DS, Jeloka TK, Agarwal D, Krishna A, Perumalla R, Jain M, Guleria S, Rees MA
Indian Journal of Nephrology, 2018  |  Volume : 28  |  Issue : 1  |  Page : 1-9

"Conclusion: KPD transplant is legal, cost-effective, rapidly expanding modality with good long-term outcome, and being implemented in several centers in India with the potential to increase LDKT by 25%. KPD transplant should be encouraged over ABOiKT and desensitization protocol. The quality of matching and number of KPD will be superior in national program versus single-center program due to large donor pool. Transplant team members, stakeholder, and policy-makers should work together to expand KPD.

...
These are recommendation on KPD transplantation after the Indian Society of Organ Transplantation (ISOT) midterm meeting organized at Chennai on March 18, 2017, and 1-day Workshop organized at Hotel Pullman, Aerocity, New Delhi, on April 29, 2017, under the Aegis of ISOT and participation of NOTT organization to discuss various issues related to expanding KPD and starting the National KPD program. Transplant surgeons, physicians, and other stakeholders from major centers across the country participated and had a robust discussion on the related issues."

Organ donation in Germany

Organ donation in Germany is declining, from an already low rate.
 Die WirtschaftsWoche has the story in their February 19 issue:

Die Zahl der Organspenden in Deutschland geht immer stärker zurück. Ökonomen machen dafür auch falsche Anreize verantwortlich. Sie schlagen Modelle vor, um mehr Menschen fürs Spenden zu gewinnen.

Google translate: "This could lead to incentives for organ donation
The number of organ donations in Germany is decreasing more and more. Economists blame it for wrong incentives. They suggest models to get more people to donate."

The article refers in part to this lab experiment investigating giving registered organ donors priority should they need an organ:

Organ donation in the lab: Preferences and votes on the priority rule
by Annika Herr and Hans-Theo Normann
Journal of Economic Behavior & Organization
Volume 131, Part B, November 2016, Pages 139-149

"Abstract: An allocation rule that prioritizes registered donors increases the willingness to register for organ donation, as laboratory experiments show. In public opinion, however, this priority rule faces repugnance. We explore the discrepancy by implementing a vote on the rule in a donation experiment, and we also elicit opinion poll-like views. We find that two-thirds of the participants voted for the priority rule in the experiment. When asked about real-world implementation, participants of the donation experiment were more likely to support the rule than non-participants. We further confirm previous research in that the priority rule increases donation rates. Beyond that, we find medical school students donate more often than participants from other fields."

The newspaper article also quotes German transplant officials as saying that this would be an unethical organ market, and that it would open the door to illegal black markets...

Tim Bresnahan, Ariel Pakes and Rob Porter win BBVA Award, for their pioneering work in industrial organization, and Bill Nordhaus wins for his work in climate change

Breaking news:
The BBVA Foundation recognizes Bresnahan, Pakes and Porter for opening up the field of empirical industrial organization

"The BBVA Foundation Frontiers of Knowledge Award in the Economics, Finance and Management category goes, in this tenth edition, to Timothy Bresnahan, Ariel Pakes and Robert Porter for founding and shaping the field of empirical industrial organization, a branch of economics that has developed fundamental techniques to measure market power (understood as the ability of a firm to control prices in a given industry). “Motivated by important and policy-relevant questions in applied economics,” remarks the jury in its citation, “they developed methodologies that had a significant and long-lasting impact on subsequent work in industrial organization as well as other applied fields.”
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William Nordhaus, the father of climate change economics, wins the BBVA Foundation Frontiers of Knowledge Award

"The BBVA Foundation Frontiers of Knowledge Award in the Climate Change category goes, in this tenth edition, to economist William Nordhaus, of Yale University (USA) for founding the field of climate change economics, by “pioneering a framework that integrates climate science, technology and economics to address the critical question: What should the world do to limit climate change?”:

Israel celebrates Sergiu Hart

The Israel Prize goes to Sergiu Hart! Here's a picture of him I once took in Jerusalem:

Sergiu Hart

Here's the story from the Jerusalem Post:
PROF. SERGIU HART TO RECEIVE ISRAEL PRIZE IN ECONOMIC RESEARCH, STATISTICS

"Prof. Sergiu Hart of the Hebrew University will be awarded the Israel Prize for economic research and statistics, the Education Ministry announced on Thursday.
...
"In its decision, the prize committee called Prof. Hart – a former president of the World Association of Game Theory and member of the Academy of Sciences of Israel, Europe and the United States – one of the world’s leading economists.

“Prof. Hart specializes in the field of game theory and its comprehensive implications in various economic fields. Among other things, it has an important contribution to the understanding of the convergence to market equilibrium, the value of a player in the game, how cartels are created in the markets and the development of objective risk indices,” the committee wrote.

"In recent years, it added, Hart’s research has focused on “designing mechanisms such as tenders, which are important in online trade.”

"Hart was born in Bucharest, Romania, and immigrated to Israel at the age of 14 along with his family. After serving in the IDF, he received undergraduate and graduate degrees from Tel Aviv University in mathematics with honors before completing his post-Doctoral studies at Stanford University in California.

"In 1991, Hart founded the Center for the Study of Rationality at the Hebrew University, whose academic committee he now chairs.
“Under his leadership the center became a unique leader in the world in the study of game theory with its implications in a wide range of fields such as economics, statistics, psychology, law, biology, philosophy and more,” the prize committee wrote in its decision.

"The Israel Prize is largely regarded as the state’s highest honor. It is presented annually on Independence Day in a state ceremony in Jerusalem attended by the president, the prime minister, the Knesset speaker and the Supreme Court president."

Making algorithms fair

Fairness is elusive, even in algorithms. "Color blindness" doesn't do the trick, since minority populations may differ in other ways from majority populations.
My attention was drawn to this news story  about ongoing work by U. Penn computer scientists: Combatting ‘Fairness Gerrymandering’ with Socially Conscious Algorithms

And here's the article on which the story is based:

Preventing Fairness Gerrymandering: Auditing and Learning for Subgroup Fairness

Michael Kearns, Seth Neel, Aaron Roth, Zhiwei Steven Wu

(Submitted on 14 Nov 2017 (v1), last revised 8 Jan 2018 (this version, v3))

The most prevalent notions of fairness in machine learning are statistical definitions: they fix a small collection of pre-defined groups, and then ask for parity of some statistic of the classifier across these groups. Constraints of this form are susceptible to intentional or inadvertent "fairness gerrymandering", in which a classifier appears to be fair on each individual group, but badly violates the fairness constraint on one or more structured subgroups defined over the protected attributes. We propose instead to demand statistical notions of fairness across exponentially (or infinitely) many subgroups, defined by a structured class of functions over the protected attributes. This interpolates between statistical definitions of fairness and recently proposed individual notions of fairness, but raises several computational challenges. It is no longer clear how to audit a fixed classifier to see if it satisfies such a strong definition of fairness. We prove that the computational problem of auditing subgroup fairness for both equality of false positive rates and statistical parity is equivalent to the problem of weak agnostic learning, which means it is computationally hard in the worst case, even for simple structured subclasses.
We then derive two algorithms that provably converge to the best fair classifier, given access to oracles which can solve the agnostic learning problem. The algorithms are based on a formulation of subgroup fairness as a two-player zero-sum game between a Learner and an Auditor. Our first algorithm provably converges in a polynomial number of steps. Our second algorithm enjoys only provably asymptotic convergence, but has the merit of simplicity and faster per-step computation. We implement the simpler algorithm using linear regression as a heuristic oracle, and show that we can effectively both audit and learn fair classifiers on real datasets.