“In his fluent and accessible book, Mr. Roth vividly describes the successes of market design.” — Economist.com
“In this fascinating, often surprising book, Alvin Roth guides us through the jungles of modern life, pointing to the many markets that are hidden in plain view all around us.” — Dan Ariely, author of Predictably Irrational and The (Honest) Truth About Dishonesty
Most of the study of economics deals with commodity markets, where the price of a good connects sellers and buyers. But what about other kinds of “goods,” like a spot in the Yale freshman class or a position at Google? If you’ve ever sought a job or hired someone, applied to college or guided your child into a good kindergarten, asked someone out on a date or been asked out, you’ve participated in a kind of market. This is the territory of matching markets, where “sellers” and “buyers” must choose each other, and price isn’t the only factor determining who gets what.
In Who Gets What—and Why, Nobel laureate Alvin E. Roth reveals the matching markets hidden around us and shows us how to recognize a good match and make smarter, more confident decisions.
“Mr. Roth’s work has been to discover the most efficient and equitable methods of matching, and implement them in the world. He writes with verve and style . . . Who Gets What—and Why is a pleasure to read.” — Wall Street Journal
“A book filled with wit, charm, common sense, and uncommon wisdom.” — Paul Milgrom, professor of economics, Stanford University and Stanford Business School
Roth, who shared the Nobel Prize for Economics in 2012, shines a light on the everyday world of matching markets in diverse areas such as organ donation, public school choice programs, college admissions, employment, and online dating. Unlike commodity markets such as stocks and bonds, where price alone determines who gets what, in a matching market you are not free to choose but must also be chosen. Roth is in the forefront of the "market design" school, which aims to solve problems plaguing matching markets that are not "thick" enough (lacking sufficient participants) or suffer from "congestion" (an overwhelming range of options). As an example, he points out that over 100,000 people in the U.S. are waiting for kidney transplants, yet only about 11,000 non-directed kidneys become available each year. Using market design principles, Roth helped design the New England Program for Kidney Exchange. As another example, he examines the college application process, a vicious cycle in which, as students apply to more colleges, acceptance rates go down. After reading Roth's book, readers may or may not make better matches, but they will better understand how matching markets work.