Using Auctions to Feed the Poor

And ultrarich squash

Last week’s Nobel prize announcement was good fun. To keep the spirit going, I made this week’s video about auctions. It’s a fascinating case where a food bank network was struggling to get food to the people who needed it most. Some economists came and designed an auction to fix the problem and achieved some remarkable results.

Introduction to Auction Theory

If you want to read more on why Milgrom and Wilson got a Nobel Prize, you can read Milgrom’s introduction to auction theory. A student who has taken intermediate mircoeconomics should be able to get through most of it.

Article of the Year

I love this article on niche sports for the children of the ultrarich. It shows the insane power of incentives. The elite are looking for ways to secure a spot for their children at the best schools. Doing well in school is no longer enough because everyone does well in school. So where is the opportunity for arbitrage?

Of Princeton’s 5,300 undergraduates, approximately 930—or 17.5 percent—are recruited players; by comparison, 650—or less than 2 percent—of the University of Alabama’s 33,000 students fall into that category

With those incentives, of course you’re going to see an oversupply of top-level squash players.

Also, the writing is fantastic. Just look at this:

Like a peacock rendered nearly flightless by gaudy tail feathers, the overserved athlete is the product of a process that has become maladaptive, and is now harming the very blue-chip demographic it was supposed to help.

Break up Big Tech

Everyone’s talking about the monopolies of Amazon, Apple, and Google. But who’s looking into the ice cream truck music monopoly? This company controls 97% of all ice cream truck music

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