Fifteen years after the Global Financial Crisis: Recessions and Business Cycles in the History of Economic Thought

History of Market Design: Why Should We Write It?

Boldyrev Ivan, Radboud University Nijmegen

In this paper, I argue that theoretical mechanism design – and market design that emerged out of it – is a field too important to be neglected by historians of recent economics. Its roots in the socialist calculation controversy (in Robert Wilson’s (Roth and Wilson 2019: 125) formulation, the aim of market design was ‘[t]o implement Walras and Hayek using Hurwicz’s scheme’), its entanglement with algorithmic vision of rationality, its intricate connections to the idea of the performativity of economics (Callon and Roth 2021), and generally to the practice of applying pure microeconomic theory in real-world policymaking, its multiple and complex interdisciplinary interactions, its growing role within contemporary mainstream economics – all these aspects make the historical investigation of market design a very promising research endeavor. The paper comments on each of those aspects by drawing on the historical episodes and on the existing accounts of some of them. Callon, M., Roth, A.E. (2021). The design and performation of markets: a discussion. AMS Rev 11, 219–239 Roth, A. E., and R. B. Wilson. 2019. "How Market Design Emerged from Game Theory: A Mutual Interview." Journal of Economic Perspectives, 33 (3): 118-43.

Area: Eshet Conference

Keywords: history of recent economics, market design, mechanism design, performativity

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