The 2007 Nobel Prize for Economics
“Three Americans -- including the oldest-ever Nobel Prize winner -- will share award for creating mechanism design theory.”
“Mechanism Design Theory,” a subset of Game Theory in which we can learn several things to enrich our lives. Some key points to take away:
· Auctions are the most efficient form of market transaction: Think cheap items on eBay.
· Double auctions are the best type, in fact: Think the Google IPO.
· There is often no good market solution to providing some goods, like uncrowded roads
