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Foundations in economics

Created over 8 years ago, updated over 4 years ago

ID24305

There are many aspects of the markets and networks which need to work. There are many types of markets. Financial, matching, curation, knowledge, social, etc.

Several particularly important and practical Nobel prizes in Economics

Nobel - Ronald Coase

Breakthrough in Understanding the Institutional Structure of the Economy

  • The nature of the firm is ... due to transaction costs outside and inside of the form

  • social cost and the courts

https://en.wikipedia.org/wiki/Coase_theorem

Nobel - Akerlof-Stiglitz-Pierce

Markets with Asymmetric Information - very important insights

  • incentives and asymmetric information

INFORMATION AND THE CHANGE IN THE PARADIGM IN ECONOMICS by Stiglitz in 2011. How Information Economics came to be

Nobel - Stapley-Roth

Stable matching: Theory, evidence, and practical design

Deferred Acceptance Algorithms: History, Theory, Practice, and Open Questions By Alvin E. Roth in 2007

The Theory and Practice of Market Design Prize Lecture, December 8, 2012 by Alvin E. Roth

Nobel - von Hayek and Myrdal

The pretence of knowledge as a foundational overview in 1974 for the modern knowledge market and attention economy

the very modern problem in the information age and very easy information propagation

Nobel - John Harsanyi, John Nash, and Reinhard Selten for game theory

"for their pioneering analysis of equilibria in the theory of non-cooperative games".
https://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/1994/

with a focus on non-cooperative solution concepts

Nobel - Leonid Hurwicz, Eric S. Maskin and Roger B. Myerson

for having laid the foundations of mechanism design theory".
https://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2007/

  • Asymmetric information and economic institutions

Buyers and sellers sometimes haggle too hard and therefore fail to trade. Desirable joint projects are
sometimes not undertaken because the projects’ beneficiaries fail to agree how the costs should be
shared. Sickness insurance, for example, is typically criticized either for offering too little coverage or
for inviting misuse. In either case, the basic problem is that people have an incentive to economize
with their private information: some insurancy-policy sellers claim that their costs are high in order to
increase the price; some beneficiaries of joint projects such as insurance-policy holders claim that their
benefits are low in order to reduce their own contributions to the project; some well-insured workers
claim that they are sick, in order to reduce their workload.

Nobel - Jean Tirole

for his analysis of market power and regulation

  • PLATFORM COMPETITION IN TWO-SIDED MARKETS - ..........attached

Many if not most markets with network externalities are two-sided. To succeed, platforms in
industries such as software, portals and media, payment systems and the Internet, must “get
both sides of the market on board.” Accordingly, platforms devote much attention to their
business model, that is, to how they court each side while making money overall. This paper
builds a model of platform competition with two-sided markets. It unveils the determinants
of price allocation and end-user surplus for different governance structures (proŽ t-maximizing
platforms and not-for-proŽ t joint undertakings), and compares the outcomes with those
under an integrated monopolist and a Ramsey planner

Nobel - Herbert Simon

  • The architecture of Complexity ...........attached

The idea of near decomposability provides some guidelines for designing an
organization and information systems for it. It can also add to our understanding
of the existence of economic organizations in two ways. First, great increases in
effectiveness are obtainable by introducing mechanisms of coordination between
interrelated activities.
Second, in the Darwinian competition among systems for survival and growth, near
decomposability provides a major advantage for the systems possessing it,

Nobel - Richard H. Thaler

"for his contributions to behavioural economics".

Nobel - Daniel Kahneman and Vernon L. Smith

  • "for having integrated insights from psychological research into economic science, especially concerning human judgment and decision-making under uncertainty"

  • "for having established laboratory experiments as a tool in empirical economic analysis, especially in the study of alternative market mechanisms".

Nobel - Robert J. Aumann and Thomas C. Schelling

"for having enhanced our understanding of conflict and cooperation through game-theory analysis"
https://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2005/

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