Despite being a vast topic, economics seems at the simplest level to be about connecting buyers and sellers. But what about exchanges where money's not involved? From life-or-death matters like organ donation to finding Junior a spot in that prestigious preschool, "matching markets," where both sides must choose each other, are also an economic force.
In Who Gets What—And Why: The New Economics of Matchmaking and Market Design, Stanford professor and Nobel laureate Alvin E. Roth is plainly passionate about his subject matter. Thankfully he's also adept at translating the big concepts here into lay language. Much of his work has focused on kidney transplants and expanding the available pool of donor organs. When someone offers a kidney to a patient in need, if they turn out to be incompatible, the story can end abruptly with no transplant performed. As Roth has demonstrated, kidney "exchanges," where willing donors extend the offer to anyone who's a good match, can result in kidneys being paid forward many times over, improving the outcomes for numerous patients.
This model can affect school choice, sports team playoffs, even something as mundane as the judgment calls made when choosing a parking space. Understanding how these matches work can hopefully lead us to choose well without too much equivocation, whether we're bidding in an eBay auction or applying for a job.
Roth's goal for the book is to bring awareness of economic forces to our attention, but also to point out that they're amazing, much as the natural world becomes more seductive the closer you look. At first glance the ideas in Who Gets What—and Why can seem tangled, but tease them apart a bit and you'll find Roth has met his goal. This is heady science that will change your view of the world around you.
