McKay lecture at Pitt on Market Design

If you're in Pittsburgh, I'll be giving the McKay Lecture at my old home, the Department of Economics at Pitt.

Market Design: The Economist as Engineer

February 27, 2014 - 3:30pm to 5:00pm

The University of Pittsburgh Department of Economics proudly presents the 2014 McKay Lecture "Market Design: The Economist as Engineer" by Alvin Roth, Nobel Laureate in Economics.

Market design is an ancient human activity but a relatively new part of economics.  It seeks to understand how the design of markets and marketplaces influences their performance, to use this growing understanding to fix markets when they're broken, and to help to establish markets where they are missing. 

Mr. Roth is the Craig and Susan McCaw Professor of Economics at Standord University and the George Gund Professor of Economics and Business Administration Emeritus at Harvard University.  From 1982 to 1998, he was the Andrew W. Mellon Professor of Economics at Pitt.  He shared the 2012 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.

Roth directed the redesign of the National Resident Matching Program, through which 23.000+ doctors a year find their first employment.  He also has helped to reorganize the market for more senior physicians as they pursue subspecialty training. He helped to design the matching systems for students in several large American cities.   He is among the founders and designers of kidney exchange in the United States (along with a number of colleagues with Pittsbugh connections), which helps incompatible patient-donor pairs to find lifesaving compatible kidneys for transplantation.

Location and Address

University of Pittsburgh

Frick Fine Arts Building

650 Schenley Drive

Pittsburgh, PA  15260

Directions and Parking Information

on street parking and Soldiers & Sailors Garage

Boston Globe on 2010 death of live liver donor

The Boston Globe had a story earlier this month recounting the events surrounding the 2010 death of a liver donor (about which they wrote and I blogged at the time: Live Liver donation tragedy).

Donor’s death shatters family, stuns surgeons: Pure generosity drove Paul Hawks to donate part of his liver to his desperately ill brother-in-law. Then disaster struck, and transplant medicine has had to rethink its rules.
By Liz Kowalczyk    FEBRUARY 02, 2014

Pros and cons of paying for kidneys, in the Journal of Medical Ethics

Some pros and cons on paying for kidneys in the Journal of Medical Ethics, March 2014, Volume 40, Issue 3

From the editors' summary in the first article ("The concise argument")"

"For over half a century the subject of organ transplantation has attracted ethical debate. One such ongoing debate, provoked by the severe scarcity of organs for transplantation and a concern to increase their supply, has been about why willing live donors should continue to be prohibited from offering their own organs for sale. Against allowing this, it has often been argued that prohibition protects people in poverty from being driven to, and then harmed by, this desperate last resort. But is that how such people in poverty themselves see it? From their point of view, it has been suggested, wouldn't it be reasonable to see prohibition as depriving them of their best option, leaving them worse off than if they had been able to exercise it? Isn't the claim to protect people in poverty therefore ‘misplaced paternalism’, providing no ethical justification for prohibition?

"In this month's feature article, Simon Rippon (see page 145, Editor's choice) mounts a serious and sustained challenge to that conclusion. He argues that while it would be reasonable for people in poverty to sell their organs if given the option, it would be equally reasonable, given the ‘significant and unavoidable’ harms of a live organ donor market, for them to prefer not to have this option at all. In her commentary on Rippon's paper, Janet Radcliffe-Richards (see page 152) acknowledges that ‘a plausible case for prohibition would probably take this form’, but goes on to argue that ‘although in principle prohibition need not be paternalistic, in practice it is’, since it ‘has been imposed on everyone irrespective of any consultation’. To this, and two further commentaries, by Gerald Dworkin (see page 151) and by Adrian Walsh (see page 153), Rippon responds (see page 155) in a significant contribution to a debate that nevertheless seems likely to continue unabated as long as the need for whole organs continues so greatly to exceed their supply."

The concise argument

• Select this article

  Responding to complexity

  • Kenneth Boyd

  J Med Ethics 2014;40:143-144 doi:10.1136/medethics-2014-102070

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Feature article

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  Imposing options on people in poverty: the harm of a live donor organ market

  • Simon Rippon

  J Med Ethics 2014;40:145-150 Published Online First: 28 June 2012doi:10.1136/medethics-2011-100318
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  FREE

Commentaries

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  Organ sales and paternalism

  • Gerald Dworkin

  J Med Ethics 2014;40:151-152 Published Online First: 19 June 2012doi:10.1136/medethics-2012-100647
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  Commentary by Janet Radcliffe-Richards on Simon Rippon's ‘Imposing options on people in poverty: the harm of a live donor organ market’

  • Janet Radcliffe-Richards

  J Med Ethics 2014;40:152-153 Published Online First: 19 October 2012doi:10.1136/medethics-2012-100645
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  Commentary on Simon Rippon, ‘Imposing options on people in poverty: the harm of a live donor organ market’

  • Adrian Walsh

  J Med Ethics 2014;40:153-154 Published Online First: 29 June 2012doi:10.1136/medethics-2012-100646
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  Organ markets and harms: a reply to Dworkin, Radcliffe Richards and Walsh

  • Simon Rippon

  J Med Ethics 2014;40:155-156 Published Online First: 5 November 2012doi:10.1136/medethics-2012-101083
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Clinical ethics

Update on school choice in Britain

The Telegraph reports, unfavorably, on the rise of school choice (and demise of assignment to local schools) in Britain:
:
Surge in admissions lotteries threatens children's right to place at local school
One in 12 schools is shunning traditional catchment areas in favour of rules designed to engineer a more balanced student body

"Some one in 12 schools is shunning traditional catchment areas in favour of rules designed to engineer a more balanced student body and break the middle-class stranglehold on places.

"The shift is being driven by a rise in the number of academies and free schools whose admissions policies are independent of local council control.
...
"Research by The Sunday Telegraph found that the proportion of highly oversubscribed secondary schools using lotteries or “fair banding” systems rises close to 100 per cent in parts of London. Across England, half of councils confirmed that at least one school in their area now used them.
...
"The Department for Education said admissions were run by individual schools or councils but insisted places “should be allocated in a fair and transparent way”. Parents will find out which state secondary school their children have been allocated on March 3 as part of National Offer Day.
Most schools have traditionally allocated places based on the distance between a pupil’s home and the school gates. This has allowed wealthier parents to buy property close to the best schools to secure places, with research suggesting that living in the catchment area of a highly sought-after school can add an average £31,500 “premium” to house prices.
But admissions guidance introduced by Labour allows institutions to employ a series of measures designed to break the stranglehold.
Lotteries, or “random allocation”, involve some or all applicants having their names drawn from a ballot, giving pupils living several miles away the same chance of a place as those next door.
“Fair banding” sees all applicants sit an aptitude test, with a set number of bright, average and low ability pupils being admitted. Schools usually use distance or a lottery to decide who gets a place within each ability band. Mrs Wallis said many parents “find fair banding complicated”, but insisted it was preferable to straight lotteries because “its goals are clearer”.

"Last week, The Sunday Telegraph obtained data on the admissions policies of more than 1,400 schools – 43 per cent of those nationally. Half of local authorities surveyed said at least one school in their area used lotteries, fair banding or both.
In total, one in 12 of the schools identified employed these admissions policies. Twice as many used fair banding as lotteries"

Gale and Shapley '62, a long-standing appreciation

While preparing for a talk I gave in England, I recently reread my 1990 paper: Roth, A.E., "New Physicians: A Natural Experiment in Market Organization," Science, 250, 1990, 1524-1528.

I hadn't recalled it, but this was the last paragraph of that paper:

"It is noteworthy that the simple idea of pairwise stability formulated by Gale and Shapley (5) has turned out to have so much empirical power. I think their paper has thus proved to be the kind of theoretical work that merits the highest scientific recognition."

Some industrial farming practices become cause for popular concern

Kristof in his NY Times column: Is that sausage worth this?

"While forcing hogs to be solitary and immobile in gestation crates for their entire adult lives is soul-crushing, popular disgust is leading to a revolution in industrial farming practices. Whole Foods and Chipotle and Burger King were among the first companies to avoid pigs raised in gestation crates, and, in the last few years, McDonalds, Safeway, Costco, Oscar Mayer and dozens of other companies have announced similar moves, often after a transition. It doesn’t seem as though costs will rise significantly.

"Carl Icahn, the investor, warned Tyson Foods that it had to drop gestation crates if it wanted to find buyers for its pork. Tyson got the message: Just last month, it wrote to all its suppliers and told them to treat pigs more humanely and to give them space to turn around. Smithfield Foods, which is the world’s largest pork producer and was acquired last year by a Chinese company, last month reaffirmed its commitment to transition away from gestation crates."

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Here's an interview on such matters I gave not long ago: Alvin Roth On Future Of Food

Should museums sell art only to buy more art?

Another university has contemplated--and then gone ahead with--selling art to raise money.
Inside Higher Ed has the story:

Art vs. Endowment

February 10, 2014

By

Scott Jaschik

"More than six years after announcing plans to sell a masterpiece of American painting -- the 1912 work "Men of the Docks," by George Bellows -- Randolph College has done so, gaining $25.5 million for its endowment.

In selling the painting, the college disregarded the policies of several art and museum groups, which state that museums (including those run by colleges) should sell art only to buy more art, not to improve their finances. The significance of "Men of the Docks" is evident not only by the price, but by the purchaser, the National Gallery of Britain, for which the painting is the first major work by an American ever bought for the permanent collection.

Randolph officials portray the sale as a success for the college, giving its endowment a significant boost, and point as well to internship opportunities the National Gallery has agreed to create for Randolph students.

But arts associations fear that such sales only encourage others, and undermine the role of college museums in preserving art, and educating students about art. In some cases, as at Randolph, college administrators have proposed to sell art. Brandeis University administrators in 2009 proposed to sell off its noted collection of modern art -- and the university backed away from the plan after a huge uproar.

Sometimes the idea is pushed from outside (especially at public universities). In 2011, some legislators urged the University of Iowa to sell Jackson Pollock's "Mural," an 8-by-20-foot painting that is considered one of the masterpieces of abstract art and of modern American art. (The university resisted the push.)

At Randolph, the board approved plans in 2007 to sell four paintings from the college's art museum, fought off a lawsuit seeking to block the sale, and sold one prior to "Men of the Docks," which is by far the most valuable and artistically significant in the collection."

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Recall the earlier imbroglio that ensued when Brandeis university considered selling some of its art, which I wrote about here.