Markets don't just spontaneously happen in their final (or current) form. They evolve or are designed by government and participants. Without such design or evolution, markets are rife with failures. Government must be involved to shape the laws and regulations that give order to the market.
- Markets in Organs (6 links)
- Society is very leery of creating markets for organs, for very good reasons. Many libertarians (following ideological dictates of Self-Ownership and Market Fundamentalism) think organ markets should be unregulated.
- Matching Theory (5 links)
- (Also known as Stable Allocations.) Lloyd Shapley and Alvin Roth won the Nobel prize in economics for this theory. Noah Smith says "Matching Theory is basically an algorithm - a mathematical technology - for finding optimal matches between pairs or groups of people. It incorporates human preferences, optimization, and strategic behavior, so it is economics." It is also a good example of Central Planning that can work better than actual markets, and works well in the real world for organ donations.
- The Art of Designing Markets [More...]
- "Market designers have already had an impact on kidney exchange, the hiring of new doctors, school choice programs, and auctions of radio spectrum. Internet job markets and markets for takeoff and landing slots at airports are among the many other areas in which market malfunctions are likely and thus adjustments informed by the insights of this new discipline will be called for."
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