Lecture: Market Design: Theory and Practice (Spring 2018)

Lecturer: Prof. Dr. Sven Seuken
Teaching Assistant: Ludwig Dierks
Teaching Language English
Level MSc, PhD
Academic Semester Spring 2018
Time and Location

Tuesday 10:15 - 12:00

Room: BIN 1.D.29 (Binzmühlestrasse 14)

AP (ECTS): 6 (including a mark)
Office Hours Prof. Dr. Sven Seuken: email for appointments, BIN-2.B.02

News

  • 21.02.2018: Add slides introduction / logistics lecture: 01-Introduction_Slides (PDF, 599 KB)
  • 17.01.2018: Update description; add links to papers
  • 15.01.2018: Final time and room
  • 13.01.2018: Course website goes live

Course Content

Market design is a research area situated at the intersection of economics, computer science, operations research, and many other fields, and it takes an “engineering approach” to the design of marketplaces. This course explores the theory and practice of market design with a focus on market design solutions that have been deployed in the real world. Throughout the course, we will pay close attention to the role that economics, game theory, computer science, and experimentation plays in the design of marketplaces. The exact list of topics varies each year, but key topics will typically include combinatorial spectrum auctions, health care markets, reputation systems, financial markets, school choice markets, course allocation mechanisms, electricity markets, and virtual currencies. Students will read key papers from the literature and get hands-on experience by working on a market design project.

Teaching Format and Setup

The course has two parts. The first part is structured like a PhD-level seminar, where students read a market design research paper each week, write a brief response essay (0.5 pages), and most of the time in class is used for interactive discussions. Each week, one or two students present the week's paper and lead the discussion.

The second part of the course consists of a market design project (on which students can work alone or in teams of 2 or 3 students). In this project, students study a market design problem of their choice in detail. This may involve identifying a new market design problem, formalizing it, and studying it (formally and/or computationally). Alternatively, this may involve taking an existing market design solution (from the literature or from the real-world) and extend or analyze it further (formally and/or computationally). The project includes a 1-page project proposal, a brief presentation of the project proposal, a project report (10-20 pages), and a presentation of the final project at the end of the semester. Successful projects could ideally lead to a workshop or conference paper submission.

Schedule

  1. 20.2.2018: Introduction: Course Overview | [slides] (PDF, 599 KB)
  2. 27.2.2018: The Economist as an Engineer |  [paper]
  3. 6.3.2018: Health Care Markets |  [paper]
  4. 13.3.2018: Electricity Markets |  [paper]
  5. 20.3.2018: High Frequency Trading |  [paper]
  6. 27.3.2018: Combinatorial Spectrum Auctions |  [paper]
  7. 10.4.2018: Incentive Auction |  [paper1] [paper2]
  8. 17.4.2018: Project: Presentation of Proposal Ideas
  9. 24.4.2018: Repugnance as a Constraint on Markets |  [paper]
  10. 8.5.2018: Food Banks Market |  [paper]
  11. 15.5.2018: Course Allocation |  [paper2]
  12. 22.5.2018: No class (time to work on projects)
  13. 29.5.2018: Project: Final Presentations

Prerequisites

Successful completion of a course covering basic topics on market design (such as auction theory, mechanism design, matching, etc.). Courses with the necessary background include “Economics and Computation” and “Introduction to Market Design” at UZH, as well as “Algorithmic Game Theory” at ETH. Students who have not taken such a course beforehand may be eligible but must contact the instructor ahead of time to request explicit consent.

Target Audience

Recommended for MSc and PhD students (in particular from computer science, economics, business, or finance) who are interested in the theory and practice of market design.

Learning Objectives

  1. Understand that market design solutions for real-world problems require attention to detail.
  2. Understand that there are many different market design techniques, and no one-size-fits-all solution.
  3. Be able to distinguish bad from good market design proposals.
  4. Be able to read advanced market design research papers.
  5. Be able to critically reflect on and discuss a market design research paper.
  6. Be able to work on a market design research project.

Examination and Grading

  • Presentation of papers and leading class discussion: 20%
  • Response essays and class participation: 30%
  • Project: 50%