Economics is dry and dreary, right? Not in Al Roth’s hands. With the accessibility of Bill Nye and the relatability of those Mythbusters guys, Who Gets What—and Why explains the ins and outs of matching markets (as opposed to financial and commodities ones that trade in interchangeable things like stocks and gold). Roth covers everything from dating websites to kidney transplants, from jobs for young doctors to public school assignment, using each to demonstrate that “[m]arkets are human artifacts, not natural phenomena,” and those who design and redesign them change lives.
“Economics is about the efficient allocation of scarce resources, and about making resources less scarce,” Roth begins, and then modestly reveals how he and a handful of others used algorithms and clearinghouses to create a Nobel-Prize-winning field of study with a plethora of practical applications.
Roth tells fascinating tales, describing, for example, how the matching of football teams to play in bowl games and the market for coffee beans have evolved over time, all the while teaching basic principles of market design (e.g., “The first task of a successful marketplace is bringing together many participants who want to transact, so they can seek out the best transactions. Having a lot of participants makes a market thick.”).
Through good pacing and foundation-laying, Roth manages to entertain (e.g., “At the Wetherby School in England, a school Princes William and Harry attended, the spaces reserved by newborns fill up early each month, and the school advises women scheduling cesarean sections to have them on the first of the month, if possible, to get a place before all the spots are gone”) without sacrificing nuance (e.g., “Notice the tension between commoditization and product differentiation—that is, between wanting to sell in a thick market to buyers even if they don’t care who you are, and trying to make your product special enough that many buyers will care enough about you to seek you out”).
He also deftly discusses political hurdles to market improvement, like real estate agents increasingly serving as unnecessary middlemen who withhold easy-to-match exchanges; “[s]chool choice divid[ing] parents into two ‘parties’ [with p]eople who live near good schools becom[ing] the ‘walk-to-school party,’ while those who live elsewhere become the ‘school choice party’”; and areas like healthcare and financial trading rules where “lots of market participants [have] a stake in the status quo.”
Despite disappointment at others limiting the transformative power of his work, Roth maintains optimism “about what can be done through careful design and monitoring of a market to fix it if it isn’t working well” as well as no small amount of wit (e.g., “Doctors don’t automatically think of economists as fellow members of the helping professions”).
The last few chapters would have benefited from a bit more tightening, but on the whole Who Gets What—and Why is virtually an ideal work of nonfiction, as engaging as it is educational.