Who gets what and why

The economics of distribution and luck

Dear subscribers,

"Who Gets What and Why" is a book written by Alvin E. Roth, a Nobel laureate in economics, that explores the field of market design and how it affects the allocation of resources. The book focuses on various real-life examples and case studies to explain the principles behind matching markets and their impact on individuals and societies.

I gravitated to economics because I'm interested in how people coordinate and collaborate with each other. Economics studies all the ways people get along with each other — Alvin E. Roth

Roth begins by introducing the concept of market design and the role it plays in shaping the outcomes of different economic systems. He argues that markets are not always efficient or fair, and that thoughtful design can improve outcomes and create better matches between buyers and sellers.

The book delves into specific market designs and their applications, such as the assignment of students to schools, the allocation of human organs for transplantation, and the matching of doctors to hospitals. Roth explains how these markets can be redesigned to overcome inherent inefficiencies and unfairness, often using mechanisms such as auctions or matching algorithms.

Here’s a quick summary for you -