Wednesday, September 20, 2017

Hurricanes and price gouging (and watermelon)

Accusations of price gouging don't just concern food and water and plywood and gasoline: nowadays we evacuate by airplane as well. But last minute bookings are always expensive...

Airlines Face Criticism Amid Irma Price-Gouging Complaints
"Florida residents have been logging their compaints about unfair pricing of items like water and gasoline, along with airfares, with the office of Pam Bondi, the attorney general of Florida. There have been more than 7,000 since Monday, the attorney general said on Friday.
In their letter to Transportation Secretary Chao, Senators Blumenthal and Markey wrote:
“Airlines certainly have a right to a reasonable return for services rendered and vagaries in pricing are to be expected; but airlines have no right to impose exorbitant, unfair prices on Americans simply trying to get out of harm’s way.”
Florida Representative Charlie Crist also wrote a letter to Ms. Chao, calling for an investigation of United Airlines after receiving several complaints over airfare increases.
...
"“If there’s any gouge, it’s just the last minute walk-up airfares that are designed for desperate business fliers,” Mr. Hobica said. “It’s just the computer programs doing what they do when it’s last minute and seats are scarce.”
Delta, the target of the initial viral complaint, has denied changing its pricing structure leading up to Irma’s arrival and has capped its one-way fares out of South Florida at $399 through Sept. 13 (other airlines like JetBlue lowered one-way fares to as low as $99.) "
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I've never been able to track down if it's a true story, but I've heard over the years of some hurricane in which people both lined up to buy some essential good at a very high price, and then clapped when the police showed up to arrest the purveyors for price gouging and confiscate the goods.
Stephanie Wang points me to this second or third hand account, where the good in question is ice.

They Clapped: Can Price-Gouging Laws Prohibit Scarcity?

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Here are two recent articles, con and pro on raising prices in an emergency (they both have a picture of empty shelves...)

Memo to economists defending price gouging in a disaster: It's still wrong, morally and economically  by 

Price Gouging Can Be a Type of Hurricane Aid
Higher prices can help resources get to the people who need them most.
by Tyler Cowen

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Of course, not all accusations of price gouging arise from emergencies. Consider the watermelon. The Jordan Times has the story:
Petra diner closed temporarily for ‘overpricing melon’  Photo of fat bill goes viral, triggers anger, mockery

"AMMAN — The Petra Development and Tourism Region Authority (PDTRA) on Wednesday decided to extend the closure of a tourist restaurant over an over-priced bill of a watermelon.

"A photo of the bill went viral on social media sites, triggering both angry reactions and mockery.

"PDTRA President Mohammad Nawafleh told The Jordan Times on Thursday that the restaurant, whose rent contract had already expired on July 15, will be closed for two months for selling a water melon for an unreasonably high price and serving food items that are not listed on its menu.
...
"Commenting on the issue, Tourism Expert Sami Hasanat said that such overpricing would harm the “already deteriorating” sector in the Kingdom.

"Authorities have to ensure that prices are always within the “reasonable” levels, as prices would affect the turnout of tourists, added Hasanat, a former MP."

Tuesday, September 19, 2017

Marijuana in California: will the illegal market coexist with the legal market?

"California, which by one estimate produces seven times more marijuana than it consumes, will probably continue to be a major exporter — illegally — to other states. In part, that is because of the huge incentive to stay in the black market: marijuana on the East Coast sells for several times more than in California."

That's from the NY Times article
Legal Marijuana Is Almost Here. If Only Pot Farmers Were on Board

Monday, September 18, 2017

School choice in Chile (deferred acceptance algorithm)

There are new school choice systems being used this year in Chile, based on the deferred acceptance algorithm.

"La ciencia detrás del nuevo sistema--
Algoritmo promete terminar con filas y discriminación en la admisión escolar")

(Google Translate: The science behind the new system--
Algorithm promises to end rows and discrimination on school admission)


Here's a sentence that gives an indication of the old system the new school choice system replaces (courtesy of Google Translate):
"What is changing is the night and the long lines because it is a centralized postulation system that guarantees that all those who register in the agreed term do not have to queue and can apply from home."

Sunday, September 17, 2017

Yemenis selling kidneys in Egypt: Al Jazeera

Al Jazeera has the (nuanced) story:
Desperate Yemenis sell organs to survive
Victims of trafficking rings say the networks operate anonymously in shisha bars and coffee shops in Yemen and Egypt.

"Ali - who is unemployed, divorced and in his early thirties - recently found himself facing a stark choice. He could either sign up to fight with the Houthi rebels on the front lines of the war in Yemen, seek work in neighbouring Saudi Arabia, or sell his organs.

"There are no jobs, and my wife left me for another man," Ali said despondently from his postoperative bed in Yemen's Bani Matar district, southwest of the capital Sanaa.

"After more than two years of war, many working-class Yemenis have turned to selling grocery items and khat - a mild, chewable narcotic - to make a meagre living. Others have opted to sell their organs to survive.
...
"Ali said that the doctor who performed his operation did not warn him of the potential consequences and there was no postoperative care. Patients are compelled to sign a contract that states, "It is not our responsibility if complications arise after the surgery," he added.

"Once the surgery was done, and I received the money, I was on my own," Ali said.
...
"A few operations are done in big hospitals with proper medical care; the majority are done in unlicensed or makeshift operation theatres with inadequate equipment or staff, Maqtari added. Only 45 percent of the healthcare facilities in Yemen are fully functional.
...
"As Yemen's war drags on, the future is anything but certain. But for Adnan Ali, who will soon enter his second marriage with the woman of his dreams and launch a taxi service, there are signs of a brighter future.

"Arrangements are under way for the wedding," he said, "and I am planning to buy a car to run a taxi."

Saturday, September 16, 2017

Sven Seuken appointed Chief Economist of BandwidthX

Here's the press release:

BandwidthX Appoints Sven Seuken as Chief Economist
Prof. Seuken’s appointment underlines the importance of market design in BxMarket

"BandwidthX, the operator of the cloud-based mobile data market, today announces Prof. Sven Seuken as its Chief Economist. Professor Seuken is one of the world's experts in electronic market design. He is a tenured Associate Professor of Computation and Economics at the University of Zurich in Switzerland where he supervises a team of seven PhD students and Postdocs, conducting research on market design topics. At BandwidthX, Professor Seuken enjoys a broad mandate including the design and analysis of market mechanisms and trading rules to drive new efficiencies in BxMarket. The appointment comes at an exciting moment as BandwidthX is expanding its platform across various data networks and global offerings.

"Professor Seuken holds a PhD in Computer Science from Harvard University. Since 2006, he has been conducting research on electronic market design. His main focus lies on designing marketplaces with complex combinatorial constraints. Applications he has worked on include peer-to-peer backup markets, electricity markets, matching markets, spectrum auctions, data markets, financial markets, cloud computing markets, and bandwidth markets.  Prof. Seuken has received several awards, including a Google Faculty Research Award, a Microsoft Research PhD Fellowship, and a Fulbright Fellowship."
...
"BandwidthX operates an advanced connection management service and a cloud-based marketplace where both Mobile Operators and Network Service Providers can define their value for data capacity in real time and are automatically matched when their values align. BxMarket gives the Mobile Operators incremental data capacity at lower cost, while allowing the Network Service Providers to profit from new revenue streams from their underutilized data networks. With this new form of micro-commerce, everyone in the mobile data ecosystem wins: from Mobile Operators and Network Service Providers to equipment and software vendors, aggregators and financial clearing companies and, of course, the end user of the device. Learn more about BandwidthX at http://www.bandwidthx.com.

Friday, September 15, 2017

An optimistic view of transplants in China from the Washington Post

I've written a number of posts linking to optimistic stories about China's move away from using executed prisoners as sources of organs for transplants, and others expressing some skepticism. The Washington Post has some elements of reporting that indicates that they explored and discounted some of the reasons for skepticism, so I think this is the most credibly optimistic assessment I've seen to date.

Here's the Washington Post story:
China used to harvest organs from prisoners. Under pressure, that practice is finally ending.

"China had more than 600 organ transplant centers in a sprawling, unregulated system. That number was whittled down to about 160 registered and approved centers in 2007, when legislation was also introduced to outlaw organ trafficking and ban foreigners from coming to the country to receive Chinese organs.
...
"Chinese law does not explicitly rule out using organs of prisoners condemned to death by the criminal courts, and Huang himself was quoted in Chinese media in late 2014 and early 2015 as saying prisoners could “voluntarily” donate organs.
Huang now disavows those comments, insisting there is “zero tolerance” for using any prisoners’ organs in the hospital system. But in a country of 1.3 billion people, he said at a Vatican conference in February, “I am sure, definitely, there is some violation of the law.”
Lawyer Yu Wensheng said that one of his clients had shared a Beijing prison cell with a man facing the death penalty last November and that the condemned man was given a form to sign to “voluntarily” donate his organs.
Death-row prisoners, he said, were “given the choice not to sign the forms, but they would receive much more mistreatment and suffer much more. If they sign, their last days of life would pass more easily.”
Yet the supply of organs from executed prisoners seems to have been drying up because the number of death sentences appears to have fallen dramatically after a 2007 mandate requiring the Supreme Court to review all capital cases."
...
"Transplant patients must take immunosuppressant drugs for life to prevent their bodies from rejecting their transplanted organs. Data compiled by Quintiles IMS, an American health-care-information company, and supplied to The Post, shows China’s share of global demand for immunosuppressants is roughly in line with the proportion of the world’s transplants China says it carries out.
Xu Jiapeng, an account manager at Quintiles IMS in Beijing, said the data included Chinese generic drugs. It was “unthinkable,” he said, that China was operating a clandestine system that the data did not pick up.
Critics counter that China may also be secretly serving large numbers of foreign transplant tourists, whose use of immunosuppressant drugs would not appear in Chinese data. But this assertion does not stand up to scrutiny.
Jose Nuñez, head of the transplantation program at the World Health Organization, which collects information on transplants worldwide, says that in 2015 the number of foreigners going to China for transplants was “really very low,” compared with the traffic to India, Pakistan or the United States, or in comparison with transplant-visitor numbers in China’s past.
Chapman and Millis say it is “not plausible” that China could be doing many times more transplants than, for instance, the United States, where about 24,000 transplants take place every year, without that information leaking out as it did when China used condemned prisoners’ organs.
And lawyers who have defended Falun Gong practitioners also reject allegations that those prisoners’ organs are being harvested.
“I have never heard of organs being taken from live prisoners,” said Liang Xiaojun, who said he had defended 300 to 400 Falun Gong practitioners in civil cases and knew of only three or four deaths in prison.
In China, despite state repression, family members can be determined in speaking out and seeking justice when relatives vanish.
If tens of thousands of Falun Gong practitioners were being executed every year, that information would emerge, experts say.
A U.S. congressional commission on China, the State Department and the Falun Gong community website have separately tried to estimate the number of political prisoners in China, and the figures range from 1,397 to “tens of thousands” — and even that upper number is significantly lower than the 500,000 to 1 million claimed by Gutmann and others."

Thursday, September 14, 2017

An Invitation to Market Design by Kominers, Teytelboym and Crawford

Scott, Alex and Vince have written an introduction to what I gather is a special issue of the Oxford Review of Economic Policy devoted to market design.  It is also a concise and easy to read introduction to the field, with some guesses about where we're going.

An Invitation to Market Design
Scott Duke Kominers, Alexander Teytelboym, Vincent P. Crawford
 September 4, 2017

Abstract: Market design seeks to translate economic theory and analysis into practical solutions to real-world problems. By redesigning both the rules that guide market transactions and the infrastructure that enables those transactions to take place, market designers can address a broad range of market failures. In this paper, we illustrate the process and power of market design through three examples: the design of medical residency matching programs; a scrip system to allocate food donations to food banks; and the recent “Incentive Auction” that reallocated wireless spectrum from television broadcasters to telecoms. Our lead examples show how effective market design can encourage participation, reduce gaming, and aggregate information, in order to improve liquidity, efficiency, and equity in markets. We also discuss a number of fruitful applications of market design in other areas of economic and public policy