Market Design
Description
Markets are the basic mechanism by which resources are allocated to
agents. These resources include simple objects, courses in an MBA
program for example, or complex entities, like firms, which themselves
have preferences over various sets of agents. Many of these markets
are engineered by a central organization with a particular eye towards
stability and efficiency. Examples are prolific and include diverse
settings with their own peculiarities, such as medical labor markets,
organ donation, school choice programs, and the matching of cadets to
army positions. A rich theory has evolved around the design of such
markets and has been successfully applied to a wide variety of
applications, including those listed above.
This advanced Ph.D. level course gives students a background in the
theory of market design, as well as its numerous successful
applications and corresponding engineering concerns. We begin with
the standard theory of stable matching introduced by Gale and Shapley
(1962) and Shapley and Scarf (1964), and study its application to the
National Residency Matching Program. We then discuss extensions of
the theory to contracts, housing allocation, and allocation with
priorities.
The main textbook for the course is Roth and Sotomayor, Two-Sided
Matching. Readings will additionally include seminal research papers
and lecture notes. Grading will be based on class participation, a
series of 3 homework assignments, and a final presentation. While
there are no official pre-requisites, students are expected to have a
solid understanding of basic economic theory and relevant mathematical
foundations.
This course is offered in conjunction with a reading seminar by Rakesh
Vohra. Students are encouraged to attend the seminar and develop
final presentations based around the discussions in the reading
seminar. Additionally, in the spring, Tayfun Somnez will offer a
mini-course on market design, and through-out the spring semester at
University of Chicago, Eric Buddish and Scott Kominers will offer a
parallel course covering similar topics. There will be occasional
optional joint meetings and seminars with the U. of Chicago group in
downtown Chicago.
Details
Lectures: Tech L221, 3-6pm
Professor: Nicole Immorlica
Email: nickle at eecs dot northwestern dot edu
Office Hours: by appointment, Ford 3.327
Textbook: Two-Sided
Matching: A Study in Game-Theoretic Modeling and Analysis,
by Alvin E. Roth and Marilda A. Oliveira Sotomayor
Grading: based on class
participation and exercises
Announcements
Check out
the MATCH-UP
2012 workshop. The submission deadline is in March.
To register for the course, please attend the first meeting on
Jan. 4th at 2pm in Tech L221. At that meeting, we will discuss the
time and locale of future lectures attempting to accommodate
everyone's schedule.
Syllabus
4 January, 2012. Lecture 1: stable matching
model, structure
11 January, 2012. Lecture 2: structure, incentives
18 January, 2012. CANCELED
25 January, 2012. Lecture 3: incentives,
many-to-one matching
1 February, 2012. Lecture 4: matching with
contracts, large market results
8 February, 2012. Lecture 5: large market results
15 February, 2012. Lecture 6: discrete
allocation, kidney exchange
22 February, 2012. Lecture 7: kidney exchange
29 February, 2012. Lecture 8: school choice
Exercises
Exercises have been posted and are due February 29th.
You should complete six of the nine problems for full credit.
Reading Projects