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  /  News   /  The Nobel Laureate, Alvin Roth, also participated at the LACEA-LAMES 2021

The Nobel Laureate, Alvin Roth, also participated at the LACEA-LAMES 2021

During the last day of the event, professor A. Roth at the University of Stanford, held his lecture Market Design and Maintenance. He explained the market design and its functioning.

The Nobel laureate explained that to have better results in a market, it must meet different requirements such as carrying out transactions and having time to make, reject, or accept various proposals. In addition, markets must be socially accepted and safe or trustworthy to participate in them.

In this way, markets that meet these conditions allow an increase in the matches between demand and supply, which provides stability. However, Professor Roth emphasized markets are dynamic and broad and, along with different agent preferences and strategies, make market design only a controlled part of reality. This allows that, over time and due to multiple variables, the markets become congested and cannot meet those matches necessary to be stable.

The 2012 Nobel Laureate landed his presentation with different real-life examples: the job market for doctors and kidney donation. He demonstrated, in each one, how the strategies, preferences, and dynamics, both local and global, varied to achieve those matches and reach market stability.

In this way, Professor Roth explained and commented that the different strategies and the dynamism of the markets make it possible to identify aspects such as: when the allocation of scarce resources is not efficient; when the scarcity of these resources can be reduced; and finally, when public policy and the allocation of resources is not working well to correct and improve from the implementation of economic policy.