Testing economic propositions in laboratory experiments has proven a very fruitful research endeavor in recent years. This volume brings together the major contributors to experimental economics. The papers present their views on the way experiments should be done, on the power and limitations of the techniques, and on the areas in which experimentation could contribute substantially to our understanding of economic behavior. This book distills the main lessons from great experience in experimental work. It will be essential reading for all who wish to follow experimental work or who wish to do such work themselves.

The rich, multi-faceted and multi-disciplinary field of matching-based market design is an active and important one due to its highly successful applications with economic and sociological impact. Its home is economics, but with intimate connections to algorithm design and operations research. With chapters contributed by over fifty top researchers from all three disciplines, this volume is unique in its breadth and depth, while still being a cohesive and unified picture of the field, suitable for the uninitiated as well as the expert. It explains the dominant ideas from computer science and economics underlying the most important results on market design and introduces the main algorithmic questions and combinatorial structures. Methodologies and applications from both the pre-Internet and post-Internet eras are covered in detail. Key chapters discuss the basic notions of efficiency, fairness and incentives, and the way market design seeks solutions guided by normative criteria borrowed from social choice theory.

Economists often look at markets as given, and try to make predictions about who will do what and what will happen in these markets. Market design, by contrast, does not take markets as given; instead, it combines insights from economic and game theory together with common sense and lessons learned from empirical work and experimental analysis to aid in the design and implementation of actual markets In recent years the field has grown dramatically, partially because of the successful wave of spectrum auctions in the US and in Europe, which have been designed by a number of prominent economists, and partially because of the increase use of the Internet as the platform over which markets are designed and run There is now a large number of applications and a growing theoretical literature. The Handbook of Market Design brings together the latest research from leading experts to provide a comprehensive description of applied market design over the last two decades In particular, it surveys matching markets: environments where there is a need to match large two-sided populations to one another, such as medical residents and hospitals, law clerks and judges, or patients and kidney donors It also examines a number of applications related to electronic markets, e-commerce, and the effect of the Internet on competition between exchanges.

When The Handbook of Experimental Economics first came out in 1995, the notion of economists conducting lab experiments to generate data was relatively new. Since then, the field has exploded. This second volume of the Handbook covers some of the most exciting new growth areas in experimental economics, presents the latest results and experimental methods, and identifies promising new directions for future research. Featuring contributions by leading practitioners, the Handbook describes experiments in macroeconomics, charitable giving, neuroeconomics, other-regarding preferences, market design, political economy, subject population effects, gender effects, auctions, and learning and the economics of small decisions. Contributors focus on key developments and report on experiments, highlighting the dialogue between experimenters and theorists. While most of the experiments consist of laboratory studies, the book also includes several chapters that report extensively on field experiments related to the subject area studied. * Covers exciting new growth areas in experimental economics* Features contributions by leading experts* Describes experiments in macroeconomics, charitable giving, neuroeconomics, market design, political economy, gender effects, auctions, and more* Highlights the dialogue by experimenters with theorists and each other* Includes several chapters covering field experiments related to the subject area studied

Testing economic propositions in laboratory experiments has proven a very fruitful research endeavor in recent years. This volume brings together the major contributors to experimental economics. The papers present their views on the way experiments should be done, on the power and limitations of the techniques, and on the areas in which experimentation could contribute substantially to our understanding of economic behavior. This book distills the main lessons from great experience in experimental work. It will be essential reading for all who wish to follow experimental work or who wish to do such work themselves.

Game-Theoretic Models of Bargaining provides a comprehensive picture of the new developments in bargaining theory. It especially shows the way the use of axiomatic models has been complemented by the new results derived from strategic models. The papers in this volume are edited versions of those given at a conference on Game Theoretic Models of Bargaining held at the University of Pittsburgh. There are two distinct reasons why the study of bargaining is of fundamental importance in economics. The first is that many aspects of economic activity are directly influenced by bargaining between and among individuals, firms, and nations. The second is that bargaining occupies an important place in economic theory, since the 'pure bargaining problem' is at the opposite pole of economic phenomena from the case of 'perfect competition'. This volume is an outgrowth of the renewed interest in the strategic approach to the theory of bargaining and to the general theory of non-cooperative games.

This pithy and engaging volume shows that economists may be better equipped to predict the future than science fiction writers. Economists' ideas, based on both theory and practice, reflect their knowledge of the laws of human interactions as well as years of experimentation and reflection. Although perhaps not as screenplay-ready as a work of fiction, these economists' predictions are ready for their close-ups. In this book, ten prominent economists -- including Nobel laureates and several likely laureates -- offer their ideas about the world of the twenty-second century. In scenarios that range from the optimistic to the guardedly gloomy, these thinkers consider such topics as the transformation of work and wages, the continuing increase in inequality, the economic rise of China and India, the endlessly repeating cycle of crisis and (projected) recovery, the benefits of technology, the economic consequences of political extremism, and the long-range effects of climate change. For example, Daron Acemoglu offers a thoughtful discussion of how trends of the last century -- including uneven growth, technological integration, and resource scarcity -- might translate into the next; 2013 Nobelist Robert Shiller provides an innovative view of future risk management methods using information technology; 2012 Nobelist Alvin Roth projects his theory of Matching Markets into the next century, focusing on schools, jobs, marriage and family, and medicine; 1987 Nobelist Robert Solow considers the shift away from remunerated labor, among other subjects; and Martin Weitzman raises the intriguing but alarming possibility of using geoengineering techniques to mitigate the nevitable effects of climate change. In a 1930 essay mentioned by several contributors, "Economic Possibilities for Our Grandchildren," John Maynard Keynes offered predictions that, read today, range from absolutely correct to spectacularly wrong. This book follows in Keynes's path, hoping, perhaps, to better his average.

Two-sided matching provides a model of search processes such as those between firms and workers in labor markets or between buyers and sellers in auctions. This book gives a comprehensive account of recent results concerning the game-theoretic analysis of two-sided matching. The focus of the book is on the stability of outcomes, on the incentives that different rules of organization give to agents, and on the constraints that these incentives impose on the ways such markets can be organized. The results for this wide range of related models and matching situations help clarify which conclusions depend on particular modeling assumptions and market conditions, and which are robust over a wide range of conditions.

Composed in honor of the 65th birthday of Lloyd Shapley, this volume makes accessible the large body of work that has grown out of Shapley's seminal 1953 paper. Each of the twenty essays concerns some aspect of the Shapley value.

Game-Theoretic Models of Bargaining provides a comprehensive picture of the new developments in bargaining theory. It especially shows the way the use of axiomatic models has been complemented by the new results derived from strategic models. The papers in this volume are edited versions of those given at a conference on Game Theoretic Models of Bargaining held at the University of Pittsburgh. There are two distinct reasons why the study of bargaining is of fundamental importance in economics. The first is that many aspects of economic activity are directly influenced by bargaining between and among individuals, firms, and nations. The second is that bargaining occupies an important place in economic theory, since the ???pure bargaining problem??? is at the opposite pole of economic phenomena from the case of ???perfect competition???. This volume is an outgrowth of the renewed interest in the strategic approach to the theory of bargaining and to the general theory of non-cooperative games.

An indispensable survey of new developments and results in experimental economics When The Handbook of Experimental Economics first came out in 1995, the notion of economists conducting lab experiments to generate data was relatively new. Since then, the field has exploded. This second volume of the Handbook covers some of the most exciting new growth areas in experimental economics, presents the latest results and experimental methods, and identifies promising new directions for future research. Featuring contributions by leading practitioners, the Handbook describes experiments in macroeconomics, charitable giving, neuroeconomics, other-regarding preferences, market design, political economy, subject population effects, gender effects, auctions, and learning and the economics of small decisions. Contributors focus on key developments and report on experiments, highlighting the dialogue between experimenters and theorists. While most of the experiments consist of laboratory studies, the book also includes several chapters that report extensively on field experiments related to the subject area studied. Covers exciting new growth areas in experimental economics Features contributions by leading experts Describes experiments in macroeconomics, charitable giving, neuroeconomics, market design, political economy, gender effects, auctions, and more Highlights the dialogue by experimenters with theorists and each other Includes several chapters covering field experiments related to the subject area studied

"I wish every economist and economics graduate student would read this book. Those who are considering running experiments should be forced to; this is a bible in how to run good experiments. Every chapter is amazingly comprehensive and has been written by a true expert in the field. But economists who would never dream about running an experiment can benefit from reading this just as much. The beauty of experiments is that they force theorists to think carefully about their theories."--Richard Thaler, Cornell University

"This "Handbook" surveys one of the most important developments in economics in the last decade, the flowering of experimental economics. Led by two of the leaders of current economic theory and experimental economics, an impressive group of researchers provides the reader with an excellent up-to-date overview of one of the most fascinating and promising areas of current economic research."--Ariel Rubinstein, Princeton University

"The "Handbook" is not only a contribution to experimental economics, it is a major contribution to social science. It successfully combines the rigor and clarity of economic analysis with a commitment to open-minded examination of data, and a refreshing willingness to question dogma. Every student of human choice and action will find this text useful."--Daniel Kahneman, The Woodrow Wilson School of Public and International Affairs, Princeton University

"Experimental economics comes of age with this volume. At last the dust begins to clear, and it becomes possible to confront theory with coherent and reliable laboratory data."--Ken Binmore, University College of London

Composed in honour of the sixty-fifth birthday of Lloyd Shapley, this volume makes accessible the large body of work that has grown out of Shapley's seminal 1953 paper. Each of the twenty essays concerns some aspect of the Shapley value. Three of the chapters are reprints of the 'ancestral' papers: Chapter 2 is Shapley's original 1953 paper defining the value; Chapter 3 is the 1954 paper by Shapley and Shubik applying the value to voting models; and chapter 19 is Shapley's 1969 paper defining a value for games without transferable utility. The other seventeen chapters were contributed especially for this volume. The first chapter introduces the subject and the other essays in the volume, and contains a brief account of a few of Shapley's other major contributions to game theory. The other chapters cover the reformulations, interpretations and generalizations that have been inspired by the Shapley value, and its applications to the study of coalition formulation, to the organization of large markets, to problems of cost allocation, and to the study of games in which utility is not transferable.

Economists often look at markets as given, and try to make predictions about who will do what and what will happen in these markets Market design, by contrast, does not take markets as given; instead, it combines insights from economic and game theory together with common sense and lessons learned from empirical work and experimental analysis to aid in the design and implementation of actual markets In recent years the field has grown dramatically, partially because of the successful wave of spectrum auctions in the US and in Europe, which have been designed by a number of prominent economists, and partially because of the increase use of the Internet as the platform over which markets are designed and run There is now a large number of applications and a growing theoretical literature. The Handbook of Market Design brings together the latest research from leading experts to provide a comprehensive description of applied market design over the last two decades In particular, it surveys matching markets: environments where there is a need to match large two-sided populations to one another, such as medical residents and hospitals, law clerks and judges, or patients and kidney donors It also examines a number of applications related to electronic markets, e-commerce, and the effect of the Internet on competition between exchanges