4 ms·

I know aligning incentives is usually something that falls under the broad category of "management" or people skills in a company, but there's a subfield of eco

I know aligning incentives is usually something that falls under the broad category of "management" or people skills in a company, but there's a subfield of economics that studies exactly how to do this in a structured way (https://en.wikipedia.org/wiki/Mechanism_design https://en.wikipedia.org/wiki/Mechanism_design). It's usually applied to things like auctions, but I've always thought applying incentive alignment in a systematic way (in which, for instance, middle management submits "bids" for metrics that they want to track and for headcount) could be a viable way to run things. Any thoughts on something like this?

ethanbond 3y ago
Whoa, I’ve never come across Mechanism Design specifically, though I did dabble in some research (and application in pharmaceutical R&D software) of market/auction design. I found that stuff to be profoundly useful, so I’ll definitely dive into mechanism design. Have you found any particularly good resources/books on this? FWIW I loved Alvin Roth’s “Who gets what and why” which is about market design mostly.
- silencethendang 3y ago
  Sorry for the late reply. I've never heard of the Al Roth book, but seems interesting. I'll check it out. I mostly became familiar with Mechanism Design when I took the first year microeconomics sequence in graduate school (basically one of the few departments this stuff is covered academically is in Economics). So my best reference that I can vouch for is, unfortunately, probably this: https://global.oup.com/ushe/product/microeconomic-theory-9780195073409?cc=us&lang=en& https://global.oup.com/ushe/product/microeconomic-theory-978... There's also Matthew Jackson's book which might be better. I've read his class notes for other topics and I think he does a good job explaining: https://web.stanford.edu/~jacksonm/mechtheo.pdf https://web.stanford.edu/~jacksonm/mechtheo.pdf

ethanbond 3y ago

Whoa, I’ve never come across Mechanism Design specifically, though I did dabble in some research (and application in pharmaceutical R&D software) of market/auction design. I found that stuff to be profoundly useful, so I’ll definitely dive into mechanism design. Have you found any particularly good resources/books on this? FWIW I loved Alvin Roth’s “Who gets what and why” which is about market design mostly.

silencethendang 3y ago
Sorry for the late reply. I've never heard of the Al Roth book, but seems interesting. I'll check it out. I mostly became familiar with Mechanism Design when I took the first year microeconomics sequence in graduate school (basically one of the few departments this stuff is covered academically is in Economics). So my best reference that I can vouch for is, unfortunately, probably this: https://global.oup.com/ushe/product/microeconomic-theory-9780195073409?cc=us&lang=en& https://global.oup.com/ushe/product/microeconomic-theory-978... There's also Matthew Jackson's book which might be better. I've read his class notes for other topics and I think he does a good job explaining: https://web.stanford.edu/~jacksonm/mechtheo.pdf https://web.stanford.edu/~jacksonm/mechtheo.pdf