Jean Tirole

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Matchmakers: The New Economics of Multisided Platforms by David S. Evans, Richard Schmalensee

Airbnb, Alvin Roth, Andy Rubin, big-box store, business process, cashless society, Chuck Templeton: OpenTable:, creative destruction, Deng Xiaoping, digital divide, disruptive innovation, if you build it, they will come, information asymmetry, Internet Archive, invention of movable type, invention of the printing press, invention of the telegraph, invention of the telephone, Jean Tirole, John Markoff, Lyft, M-Pesa, market friction, market microstructure, Max Levchin, mobile money, multi-sided market, Network effects, PalmPilot, Productivity paradox, profit maximization, purchasing power parity, QR code, ride hailing / ride sharing, sharing economy, Silicon Valley, Snapchat, Steve Jobs, the long tail, Tim Cook: Apple, transaction costs, two-sided market, Uber for X, uber lyft, ubercab, vertical integration, Victor Gruen, Wayback Machine, winner-take-all economy

Matchmakers is a journey through the strategies of platform businesses, which are central to our economies. Full of stories, fun to read, stimulating, and rigorous, this terrific book is required reading, from the economics and MBA student to the entrepreneur looking at building a platform to any reader curious about how our economy evolves.” —JEAN TIROLE, Chairman, Toulouse School of Economics; Winner, 2014 Nobel Prize in Economic Sciences “Matchmakers will be mandatory for anyone building or investing in multisided platforms—in the cloud or on the ground. It’s not only full of great stories like the rise of M-PESA, it’s also a practical guide to getting your platform business off the ground.

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Almost all had difficult childhoods. Many barely made it out of the crib. Now economists know why multisided platforms can create immense value, and how they do it, and also why most matchmaker start-ups sputter and die. The Discovery of Multisided Businesses In 2000, our colleagues Jean-Charles Rochet and Jean Tirole, working at the University of Toulouse in the southwest of France, made a discovery that is still reverberating through economics departments and business schools. Over the previous five years, they had conducted research on telecommunications networks, payment card businesses, and computer operating systems.

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After working out a pioneering economic model, they wrote a paper, “Platform Competition in Two-Sided Markets,” which began circulating among economists in 2000.18 Economists now call these businesses multisided platforms because some of them actually facilitate interactions between more than two types of customers, as we will soon see. Jean Tirole received the Nobel Memorial Prize in Economic Sciences in 2014 for a number of important accomplishments, including his pioneering contributions to the new economics of multisided platforms. In the intervening years, economists, including ourselves, have written hundreds of papers on multisided platforms that have deepened our understanding of how these businesses work and how they differ from traditional firms.

The Butterfly Defect: How Globalization Creates Systemic Risks, and What to Do About It by Ian Goldin, Mike Mariathasan

air freight, air traffic controllers' union, Andrei Shleifer, Asian financial crisis, asset-backed security, bank run, barriers to entry, Basel III, Bear Stearns, behavioural economics, Berlin Wall, biodiversity loss, Bretton Woods, BRICs, business cycle, butterfly effect, carbon tax, clean water, collapse of Lehman Brothers, collateralized debt obligation, complexity theory, connected car, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, David Ricardo: comparative advantage, deglobalization, Deng Xiaoping, digital divide, discovery of penicillin, diversification, diversified portfolio, Douglas Engelbart, Douglas Engelbart, Edward Lorenz: Chaos theory, energy security, eurozone crisis, Eyjafjallajökull, failed state, Fairchild Semiconductor, Fellow of the Royal Society, financial deregulation, financial innovation, financial intermediation, fixed income, Gini coefficient, Glass-Steagall Act, global pandemic, global supply chain, global value chain, global village, high-speed rail, income inequality, information asymmetry, Jean Tirole, John Snow's cholera map, Kenneth Rogoff, light touch regulation, Long Term Capital Management, market bubble, mass immigration, megacity, moral hazard, Occupy movement, offshore financial centre, open economy, precautionary principle, profit maximization, purchasing power parity, race to the bottom, RAND corporation, regulatory arbitrage, reshoring, risk free rate, Robert Solow, scientific management, Silicon Valley, six sigma, social contagion, social distancing, Stuxnet, supply-chain management, systems thinking, tail risk, TED Talk, The Great Moderation, too big to fail, Toyota Production System, trade liberalization, Tragedy of the Commons, transaction costs, uranium enrichment, vertical integration

., 2010, Regulating Wall Street: The Dodd-Frank Act and the New Architecture of Global Finance (Hoboken, NJ: John Wiley and Sons); Financial Crisis Inquiry Commission, 2011, Financial Crisis Inquiry Report: Final Report of the National Commission on the Causes of the Financial and Economic Crisis in the United States (Washington, DC: U.S. Public Affairs); or Jean Tirole, 2010, “Lessons from the Crisis,” in Balancing the Banks: Global Lessons from the Financial Crisis, ed. Mathias Dewatripont, Jean-Charles Rochet, and Jean Tirole (Princeton, NJ: Princeton University Press), 10–77. 85. Dieter Kerwer, 2005, “Rules That Many Use: Standards and Global Regulation,” Governance 18 (4): 611–632. 86. Robert M. May, Simon A. Levin, and George Sugihara, 2008, “Complex Systems: Ecology for Bankers,” Nature 451 (21 February): 893–895, quote on 893. 87.

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Louis, 2012, “Debt Outstanding Domestic Financial Sectors,” Board of Governors of the Federal Reserve System, accessed 7 December, http://research.stlouisfed.org/fred2/data/DODFS.txt. 46. Mathias Dewatripont and Jean-Charles Rochet, 2010, “The Treatment of Distressed Banks,” in Balancing the Banks: Global Lessons from the Financial Crisis, ed. Mathias Dewatripont, Jean-Charles Rochet, and Jean Tirole (Princeton, NJ: Princeton University Press), 107–130, esp. 113. 47. Andrew G. Haldane and Robert M. May, 2011, “Systemic Risk in Banking Ecosystems,” Nature 469: 351–355, quotes on 351. 48. Franklin Allen and Douglas Gale, 2000, “Financial Contagion,” Journal of Political Economy 108 (1): 1–33; and Prasanna Gai and Sujit Kapadia, 2010, “Contagion in Financial Networks,” Bank of England Working Paper 383, Bank of England, London. 49.

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Tarullo, 2008, Banking on Basel: The Future of International Financial Regulation (Washington, DC: Peterson Institute for International Economics); or Jean-Charles Rochet, 2010, “The Future of Banking Regulation,” in Balancing the Banks: Global Lessons from the Financial Crisis, ed. Mathias Dewatripont, Jean-Charles Rochet, and Jean Tirole (Princeton, NJ: Princeton University Press), 78–103. 80. The failure regarding Fortis Bank is discussed in Dewatripont and Rochet, 2010, 108. 81. Ibid. 82. Haldane, 2009. 83. White, 1997. 84. For a more extensive discussion of lessons from the crisis, see, for example, Viral V. Acharya et al., eds., 2010, Regulating Wall Street: The Dodd-Frank Act and the New Architecture of Global Finance (Hoboken, NJ: John Wiley and Sons); Financial Crisis Inquiry Commission, 2011, Financial Crisis Inquiry Report: Final Report of the National Commission on the Causes of the Financial and Economic Crisis in the United States (Washington, DC: U.S.

The Inner Lives of Markets: How People Shape Them—And They Shape Us by Tim Sullivan

Abraham Wald, Airbnb, airport security, Al Roth, Alvin Roth, Andrei Shleifer, attribution theory, autonomous vehicles, barriers to entry, behavioural economics, Brownian motion, business cycle, buy and hold, centralized clearinghouse, Chuck Templeton: OpenTable:, classic study, clean water, conceptual framework, congestion pricing, constrained optimization, continuous double auction, creative destruction, data science, deferred acceptance, Donald Trump, Dutch auction, Edward Glaeser, experimental subject, first-price auction, framing effect, frictionless, fundamental attribution error, George Akerlof, Goldman Sachs: Vampire Squid, Gunnar Myrdal, helicopter parent, information asymmetry, Internet of things, invisible hand, Isaac Newton, iterative process, Jean Tirole, Jeff Bezos, Johann Wolfgang von Goethe, John Nash: game theory, John von Neumann, Joseph Schumpeter, Kenneth Arrow, late fees, linear programming, Lyft, market clearing, market design, market friction, medical residency, multi-sided market, mutually assured destruction, Nash equilibrium, Occupy movement, opioid epidemic / opioid crisis, Pareto efficiency, Paul Samuelson, Peter Thiel, pets.com, pez dispenser, power law, pre–internet, price mechanism, price stability, prisoner's dilemma, profit motive, proxy bid, RAND corporation, ride hailing / ride sharing, Robert Shiller, Robert Solow, Ronald Coase, school choice, school vouchers, scientific management, sealed-bid auction, second-price auction, second-price sealed-bid, sharing economy, Silicon Valley, spectrum auction, Steve Jobs, Tacoma Narrows Bridge, techno-determinism, technoutopianism, telemarketer, The Market for Lemons, The Wisdom of Crowds, Thomas Malthus, Thorstein Veblen, trade route, transaction costs, two-sided market, uber lyft, uranium enrichment, Vickrey auction, Vilfredo Pareto, WarGames: Global Thermonuclear War, winner-take-all economy

Platform Builder as Internet Cop The economist who did the most to formalize our understanding of two-sided markets is Jean Tirole, a Frenchman who won the Nobel Prize in 2014.10 Within economics, Tirole is known for his superhuman productivity and, relatedly, his incredible clarity of thought. According to one of his former students, Tirole writes his papers out by hand, to be typed out by his assistant. The drafts never include scratch work or deletions—the full arc of an argument is clear in his mind as he writes out his ideas. At the Toulouse School of Economics, where he has worked since 1996, graduate students joked that there must be a dozen little Jean Tiroles hidden in his basement writing the manuscripts, given the rate at which they appeared.

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Tirole’s work on two-sided markets was done with Jean-Charles Rochet, an economist at the University of Zurich. 11. Paul Samuelson, Economics (Cambridge, MA: MIT Press, 1988; first published 1948). 12. Binyamin Appelbaum, “Q. and A. with Jean Tirole, Economics Nobel Winner,” The Upshot, New York Times, October 14, 2014, www.nytimes.com/2014/10/15/upshot/q-and-a-with-jean-tirole-nobel-prize-winner.html. 13. His precise definition goes somewhat further than this and is framed in terms of whether the level of exchange depends on the prices that participants on different sides of the platform are charged, or just the total price.

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We haven’t looked at the contracts that food producers have with grocery chains, but we’d bet that they lead both parties to care how many boxes of cereal or cans of beans get sold. Even if it’s not specified in the contract, you can be sure it’d come up the next time the grocer and its suppliers get together to do business. 6. Jean Tirole and Jean-Charles Rochet convey this point more precisely in a 2006 article where they show that two-sided markets are only necessary when the Coase Theorem fails. This theorem, more a conjecture provided by economist Ronald Coase, essentially argues that free markets maximize efficiency in the absence of externalities or transaction costs.

Platform Revolution: How Networked Markets Are Transforming the Economy--And How to Make Them Work for You by Sangeet Paul Choudary, Marshall W. van Alstyne, Geoffrey G. Parker

3D printing, Affordable Care Act / Obamacare, Airbnb, Alvin Roth, Amazon Mechanical Turk, Amazon Web Services, Andrei Shleifer, Apple's 1984 Super Bowl advert, autonomous vehicles, barriers to entry, Benchmark Capital, big data - Walmart - Pop Tarts, bitcoin, blockchain, business cycle, business logic, business process, buy low sell high, chief data officer, Chuck Templeton: OpenTable:, clean water, cloud computing, connected car, corporate governance, crowdsourcing, data acquisition, data is the new oil, data science, digital map, discounted cash flows, disintermediation, driverless car, Edward Glaeser, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, financial innovation, Free Software Foundation, gigafactory, growth hacking, Haber-Bosch Process, High speed trading, independent contractor, information asymmetry, Internet of things, inventory management, invisible hand, Jean Tirole, Jeff Bezos, jimmy wales, John Markoff, Kevin Roose, Khan Academy, Kickstarter, Lean Startup, Lyft, Marc Andreessen, market design, Max Levchin, Metcalfe’s law, multi-sided market, Network effects, new economy, PalmPilot, payday loans, peer-to-peer lending, Peter Thiel, pets.com, pre–internet, price mechanism, recommendation engine, RFID, Richard Stallman, ride hailing / ride sharing, Robert Metcalfe, Ronald Coase, Salesforce, Satoshi Nakamoto, search costs, self-driving car, shareholder value, sharing economy, side project, Silicon Valley, Skype, smart contracts, smart grid, Snapchat, social bookmarking, social contagion, software is eating the world, Steve Jobs, TaskRabbit, The Chicago School, the long tail, the payments system, Tim Cook: Apple, transaction costs, Travis Kalanick, two-sided market, Uber and Lyft, Uber for X, uber lyft, vertical integration, winner-take-all economy, zero-sum game, Zipcar

Significant scholarly work has been done in this area. Two of this book’s authors (Geoff Parker and Marshall Van Alstyne) were among the first scholars to lay out the theory of two-sided market pricing.2 And the theory was mentioned as part of the 2014 Nobel Prize awarded to one of the other originators of two-sided market economics, Jean Tirole.3 Achieving the right balance among the complex factors involved in two-sided market pricing isn’t easy. Netscape, one of the pioneers of the Internet era, gave away browsers for free in hopes of selling web servers. Unfortunately, there was no proprietary connection between browsers and servers that Netscape could reliably control.

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Thanks to regulatory capture, government rules are often used to block competition and thwart innovation rather than to protect consumers and benefit society. Stigler and his followers argue that the economy and society as a whole will benefit when regulatory capture is eliminated—and that this requires the elimination of most government regulation of business. Jean-Jacques Laffont and Jean Tirole (the latter the 2014 winner of the Nobel Prize in Economics) extended Stigler’s analysis using an agency perspective, making the point that “principals,” like voters, have imperfect control over their “agents,” including elected and appointed officials. Laffont and Tirole show that it would be impossible for firms to benefit from regulatory capture if the principals involved had more complete information about and control over the behavior of their agents.10 There’s no doubt that regulatory capture does exist.

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Our analysis shows that in fact firms with strong two-sided network externalities can maximize profit even when they distribute services to one side of the market at a price of zero. They achieve this result by earning attractive profits through sales of the goods or services they provide to the other side of the market.24 Along with other authors, including Jean Tirole, this line of research in two-sided networks has overturned the conventional wisdom and required regulators to retool their predation tests to incorporate network effects.25 In particular, regulators have viewed the practice of selling goods or services at or below cost as evidence of intent to drive competitors out of business with the intent of then raising prices once those competitors are gone.

Open for Business Harnessing the Power of Platform Ecosystems by Lauren Turner Claire, Laure Claire Reillier, Benoit Reillier

Airbnb, Amazon Mechanical Turk, Amazon Web Services, augmented reality, autonomous vehicles, barriers to entry, basic income, benefit corporation, Blitzscaling, blockchain, carbon footprint, Chuck Templeton: OpenTable:, cloud computing, collaborative consumption, commoditize, crowdsourcing, data science, deep learning, Diane Coyle, Didi Chuxing, disintermediation, distributed ledger, driverless car, fake news, fulfillment center, future of work, George Akerlof, independent contractor, intangible asset, Internet of things, Jean Tirole, Jeff Bezos, Kickstarter, knowledge worker, Lean Startup, Lyft, Mark Zuckerberg, market design, Metcalfe’s law, minimum viable product, multi-sided market, Network effects, Paradox of Choice, Paul Graham, peer-to-peer lending, performance metric, Peter Thiel, platform as a service, price discrimination, price elasticity of demand, profit motive, ride hailing / ride sharing, Sam Altman, search costs, self-driving car, seminal paper, shareholder value, sharing economy, Silicon Valley, Skype, smart contracts, Snapchat, software as a service, Steve Jobs, Steve Wozniak, TaskRabbit, the long tail, The Market for Lemons, Tim Cook: Apple, transaction costs, two-sided market, Uber and Lyft, uber lyft, universal basic income, Y Combinator

Yet igniting and scaling platforms to critical mass is a notoriously difficult exercise, and we have tried to document some of these unique challenges, as well as offer some tips and tools to address them. Standing on the shoulders of giants Academics have recently redoubled their efforts to research platforms, a relatively new field of economics known as ‘multisided markets’ only first formalized in 2003 by French Nobel economist Jean Tirole. We are most definitely standing on the shoulders of giants, and this book would not have been possible without the insights and stories from countless platform xvi Preface executives, academics, students and clients who taught us so much over the past few years. We acknowledge the contribution of all those who shared their views with us, sent us their research, invited us to seminars and workshops, participated in some of our lectures or simply retained our firm, Launchworks, to advise them.

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But for many twenty-first-century platform businesses, this framework lost much of its usefulness. While platforms and open business models are not new, their ‘mathematical formalization’ is very recent. The underlying economics of such businesses were first set out in a 2003 scholarly article by 2014 economic Nobel Prize winner Jean Tirole.15 His seminal work was primarily focused on market dynamics and antitrust concerns rather than the management of platform businesses themselves. Since then, new platform-powered challengers have emerged, and have been disrupting entrenched competitors with their meteoric rise. More importantly, these new model companies have revealed that some markets, once thought to be ‘traditional’, such as taxis and hotels, could in fact be served more efficiently with innovative and open platform business models enabled by digital technologies.

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Visa and Mastercard may not have used the term multisided markets when they launched, but their operations – of connecting card users and merchants – clearly exhibited the economic characteristics of platform businesses.8 The concept of multisided markets started to be formalized by academics in 2000. Geoff Parker and Marshall Van Alstyne were among the first economists to look closely at platform business models while trying to understand how firms such as Microsoft could sustainably offer free software.9 Shortly after, JeanCharles Rochet and Jean Tirole published a seminal paper on the economics of card platforms in 2002. Their research proposed a new economic model of the price relationships used on both sides of a multisided market to better coordinate demand.10 While the main focus area of the paper was credit cards, the analysis and key findings apply more widely.

Economics Rules: The Rights and Wrongs of the Dismal Science by Dani Rodrik

airline deregulation, Alan Greenspan, Albert Einstein, bank run, barriers to entry, behavioural economics, Bretton Woods, business cycle, butterfly effect, capital controls, carbon tax, Carmen Reinhart, central bank independence, collective bargaining, congestion pricing, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, distributed generation, Donald Davies, Edward Glaeser, endogenous growth, Eugene Fama: efficient market hypothesis, Everything should be made as simple as possible, Fellow of the Royal Society, financial deregulation, financial innovation, floating exchange rates, fudge factor, full employment, George Akerlof, Gini coefficient, Growth in a Time of Debt, income inequality, inflation targeting, informal economy, information asymmetry, invisible hand, Jean Tirole, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, labor-force participation, liquidity trap, loss aversion, low skilled workers, market design, market fundamentalism, minimum wage unemployment, oil shock, open economy, Pareto efficiency, Paul Samuelson, price elasticity of demand, price stability, prisoner's dilemma, profit maximization, public intellectual, quantitative easing, randomized controlled trial, rent control, rent-seeking, Richard Thaler, risk/return, Robert Shiller, school vouchers, South Sea Bubble, spectrum auction, The Market for Lemons, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, Thomas Malthus, trade liberalization, trade route, ultimatum game, University of East Anglia, unorthodox policies, Vilfredo Pareto, Washington Consensus, white flight

Robinson, “The Colonial Origins of Comparative Development: An Empirical Investigation,” American Economic Review 91, no. 5 (December 2001): 1369–1401. 17. A good overall synthesis of this work can be found in Daron Acemoglu and James Robinson, Why Nations Fail: The Origins of Power, Prosperity, and Poverty (New York: Crown, 2012). 18. Binyamin Appelbaum, “Q. and A. with Jean Tirole, Economics Nobel Winner,” New York Times, October 14, 2014 (http://www.nytimes.com/2014/10/15/upshot/q-and-a-with-jean-tirole-nobel-prize-winner.html?_r=0&abt=0002&abg=0). 19. See, for example, the essays in Paul Rabinow and William M. Sullivan, eds., Interpretive Social Science: A Second Look (Berkeley: University of California Press, 1987). INDEX Page numbers in italics refer to illustrations.

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Insights of these alternative perspectives are, in fact, readily accommodated within standard modeling practices of economics, as I’ve argued. All these divides can be bridged by viewing economics as a collection of models, along with a system of navigation among models. The discipline’s most successful and celebrated practitioners exemplify this approach. The French economist Jean Tirole, who won the 2014 Nobel Prize in Economic Sciences for his work on regulation, is a good example. In typical fashion, he was deluged after his prize was announced by journalists seeking a quick take on the research that had brought him the recognition. But his interlocutors were in for some frustration.

Radical Markets: Uprooting Capitalism and Democracy for a Just Society by Eric Posner, E. Weyl

3D printing, activist fund / activist shareholder / activist investor, Affordable Care Act / Obamacare, Airbnb, Amazon Mechanical Turk, anti-communist, augmented reality, basic income, Berlin Wall, Bernie Sanders, Big Tech, Branko Milanovic, business process, buy and hold, carbon footprint, Cass Sunstein, Clayton Christensen, cloud computing, collective bargaining, commoditize, congestion pricing, Corn Laws, corporate governance, crowdsourcing, cryptocurrency, data science, deep learning, DeepMind, Donald Trump, Elon Musk, endowment effect, Erik Brynjolfsson, Ethereum, feminist movement, financial deregulation, Francis Fukuyama: the end of history, full employment, gamification, Garrett Hardin, George Akerlof, global macro, global supply chain, guest worker program, hydraulic fracturing, Hyperloop, illegal immigration, immigration reform, income inequality, income per capita, index fund, informal economy, information asymmetry, invisible hand, Jane Jacobs, Jaron Lanier, Jean Tirole, Jeremy Corbyn, Joseph Schumpeter, Kenneth Arrow, labor-force participation, laissez-faire capitalism, Landlord’s Game, liberal capitalism, low skilled workers, Lyft, market bubble, market design, market friction, market fundamentalism, mass immigration, negative equity, Network effects, obamacare, offshore financial centre, open borders, Pareto efficiency, passive investing, patent troll, Paul Samuelson, performance metric, plutocrats, pre–internet, radical decentralization, random walk, randomized controlled trial, Ray Kurzweil, recommendation engine, rent-seeking, Richard Thaler, ride hailing / ride sharing, risk tolerance, road to serfdom, Robert Shiller, Ronald Coase, Rory Sutherland, search costs, Second Machine Age, second-price auction, self-driving car, shareholder value, sharing economy, Silicon Valley, Skype, special economic zone, spectrum auction, speech recognition, statistical model, stem cell, telepresence, Thales and the olive presses, Thales of Miletus, The Death and Life of Great American Cities, The Future of Employment, The Market for Lemons, The Nature of the Firm, The Rise and Fall of American Growth, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, Thorstein Veblen, trade route, Tragedy of the Commons, transaction costs, trickle-down economics, Tyler Cowen, Uber and Lyft, uber lyft, universal basic income, urban planning, Vanguard fund, vertical integration, women in the workforce, Zipcar

While we identify many of our most important intellectual influences in the course of the book, each of us had personal intellectual mentors who go less noted there, but merit our thanks. Gary Becker and especially José Scheinkman played critical roles in encouraging Glen to pursue his boldest ideas, despite the costs to his professional standing and the difficulty publishing this work. Jerry Green, Amartya Sen, and especially Jean Tirole were central to shaping Glen’s view of mechanism design as a force for social transformation. Jennifer Chayes, Glen’s supervisor at Microsoft, gave him the professional space, interdisciplinary environment, and personal inspiration he needed to believe in and pursue this project. Eric is grateful for the support of his colleagues at the University of Chicago, and to the Russell Baker Scholars Fund for financial support.

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Many social scientists have also argued that siren servers use techniques similar to those employed by casinos to make their content addictive.35 Together these properties raise the power of siren servers to lock users into patterns that may not serve their long-term interests. Second, as highlighted by economist Roland Bénabou and Nobel Laureate Jean Tirole in their incisive 2003 and 2006 analyses of situations like the Tom Sawyer problem, paying for an activity often undermines intrinsic motivations (such as entertainment and social pressure).36 Paying for online data provision may signal to users that the activities they currently view as entertainment are actually labor benefiting the siren servers and for which they should demand payment, undermining the entertainment value.

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Annalee Newitz, Raters of the World, Unite—The Secret Lives of Google Raters, Ars Technica (April 27, 2017), https://arstechnica.com/features/2017/04/the-secret-lives-of-google-raters/. 29. For example, a controversy raged in 2017 over Google’s role in the firing of a policy researcher critical of their business practices. 30. See Roland Bénabou & Jean Tirole, Intrinsic and Extrinsic Motivation, 70 Review of Economic Studies 489 (2003), for a survey of this literature. 31. Sara Constance Kingsley et al., Accounting for Market Frictions and Power Asymmetries in Online Labor Markets, 7 Policy & Internet 383 (2015). 32. Arindrajit Dube, Jeff Jacobs, Suresh Naidu, & Siddharth Suri, Monopsony in Crowdsourcing Labor Markets (Columbia University Working Paper, 2017). 33. https://www.nytimes.com/2016/05/06/business/facebook-bends-the-rules-of-audience-engagement-to-its-advantage.html?

Platform Capitalism by Nick Srnicek

"World Economic Forum" Davos, 3D printing, additive manufacturing, Airbnb, Amazon Mechanical Turk, Amazon Web Services, Big Tech, Californian Ideology, Capital in the Twenty-First Century by Thomas Piketty, cloud computing, collaborative economy, collective bargaining, data science, deindustrialization, deskilling, Didi Chuxing, digital capitalism, digital divide, disintermediation, driverless car, Ford Model T, future of work, gig economy, independent contractor, Infrastructure as a Service, Internet of things, Jean Tirole, Jeff Bezos, knowledge economy, knowledge worker, liquidity trap, low interest rates, low skilled workers, Lyft, Mark Zuckerberg, means of production, mittelstand, multi-sided market, natural language processing, Network effects, new economy, Oculus Rift, offshore financial centre, pattern recognition, platform as a service, quantitative easing, RFID, ride hailing / ride sharing, Robert Gordon, Salesforce, self-driving car, sharing economy, Shoshana Zuboff, Silicon Valley, Silicon Valley startup, software as a service, surveillance capitalism, TaskRabbit, the built environment, total factor productivity, two-sided market, Uber and Lyft, Uber for X, uber lyft, unconventional monetary instruments, unorthodox policies, vertical integration, warehouse robotics, Zipcar

‘Reinventing the Deal’. 2015. The Economist, 24 October. http://www.economist.com/news/briefing/21676760-americas-startups-are-changing-what-itmeans-own-company-reinventing-deal (accessed 4 June 2016). Rochet, Jean-Charles, and Jean Tirole. 2003. ‘Platform Competition in Two-Sided Markets’. Journal of the European Economic Association, 1 (4): 990–1029. Rochet, Jean-Charles, and Jean Tirole. 2006. ‘Two-Sided Markets: A Progress Report’. The RAND Journal of Economics, 37 (3): 645–67. Scheiber, Noam. 2015. ‘Growth in the “Gig Economy” Fuels Work Force Anxieties’. The New York Times, 12 July. http://www.nytimes.com/2015/07/13/business/rising-economic-insecurity-tied-to-decades-long-trend-in-employment-practices.html (accessed 4 June 2016).

Good Economics for Hard Times: Better Answers to Our Biggest Problems by Abhijit V. Banerjee, Esther Duflo

3D printing, accelerated depreciation, affirmative action, Affordable Care Act / Obamacare, air traffic controllers' union, Airbnb, basic income, behavioural economics, Bernie Sanders, Big Tech, business cycle, call centre, Cambridge Analytica, Capital in the Twenty-First Century by Thomas Piketty, carbon credits, carbon tax, Cass Sunstein, charter city, company town, congestion pricing, correlation does not imply causation, creative destruction, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, decarbonisation, Deng Xiaoping, Donald Trump, Edward Glaeser, en.wikipedia.org, endowment effect, energy transition, Erik Brynjolfsson, experimental economics, experimental subject, facts on the ground, fake news, fear of failure, financial innovation, flying shuttle, gentrification, George Akerlof, Great Leap Forward, green new deal, high net worth, immigration reform, income inequality, Indoor air pollution, industrial cluster, industrial robot, information asymmetry, Intergovernmental Panel on Climate Change (IPCC), Jane Jacobs, Jean Tirole, Jeff Bezos, job automation, Joseph Schumpeter, junk bonds, Kevin Roose, labor-force participation, land reform, Les Trente Glorieuses, loss aversion, low skilled workers, manufacturing employment, Mark Zuckerberg, mass immigration, middle-income trap, Network effects, new economy, New Urbanism, no-fly zone, non-tariff barriers, obamacare, off-the-grid, offshore financial centre, One Laptop per Child (OLPC), open economy, Paul Samuelson, place-making, post-truth, price stability, profit maximization, purchasing power parity, race to the bottom, RAND corporation, randomized controlled trial, restrictive zoning, Richard Thaler, ride hailing / ride sharing, Robert Gordon, Robert Solow, Ronald Reagan, Savings and loan crisis, school choice, Second Machine Age, secular stagnation, self-driving car, shareholder value, short selling, Silicon Valley, smart meter, social graph, spinning jenny, Steve Jobs, systematic bias, Tax Reform Act of 1986, tech worker, technology bubble, The Chicago School, The Future of Employment, The Market for Lemons, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, total factor productivity, trade liberalization, transaction costs, trickle-down economics, Twitter Arab Spring, universal basic income, urban sprawl, very high income, War on Poverty, women in the workforce, working-age population, Y2K

We economists, in our fealty to standard preferences, have tried very hard to keep all of that out, but it is increasingly obvious this is a hopeless quest. MOTIVATED BELIEFS Once we begin to acknowledge that our beliefs and even what we take to be our deep preferences are determined by context, many things fall into place. One important insight comes from the Nobel Prize–winner Jean Tirole’s work with Roland Bénabou on motivated beliefs.47 They argue that a big step toward understanding beliefs is not taking them too literally. Our beliefs about ourselves are shaped in part by our emotional needs; we feel terrible when we disappoint ourselves. The emotional value we put on beliefs about ourselves also leads us to distort our beliefs about others; for example, since we want to shield ourselves from our own prejudices, we couch them in the language of objective truth (“I have nothing against North African cashiers, but they would not respond to my encouragement anyway, so I don’t bother”).

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Knight, Risk, Uncertainty, and Profit (Boston: Hart, Schaffner, and Marx, 1921). 67 Justin Sydnor, “(Over)insuring Modest Risks,” American Economic Journal: Applied Economics 2, no. 4 (2010): 177–99. 68 We will return to the idea of these motivated beliefs in chapter 4. For a reference, see Roland Bénabou and Jean Tirole, “Mindful Economics: The Production, Consumption, and Value of Beliefs,” Journal of Economic Perspectives 30, no. 3 (2016): 141–64. 69 Alexis de Tocqueville, Democracy in America (London: Saunders and Otley, 1835). 70 Alberto Alesina, Stefanie Stantcheva, and Edoardo Teso, “Intergenerational Mobility and Preferences for Redistribution,” American Economic Review 108, no. 2 (2018): 521–54, DOI: 10.1257/aer.20162015. 71 Benjamin Austin, Edward Glaeser, and Lawrence H.

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Banerjee and Esther Duflo, “Reputation Effects and the Limits of Contracting: A Study of the Indian Software Industry,” Quarterly Journal of Economics 115, no. 3 (2000): 989–1017. 35 Amos Tversky and Daniel Kahneman, “The Framing of Decisions and Psychology of Choice,” Science 211 (1981): 453–58. 36 Jean Tirole, “A Theory of Collective Reputations (with Applications to the Persistence of Corruption and to Firm Quality),” Review of Economic Studies 63, no. 1 (1996): 1–22. 37 Rocco Machiavello and Ameet Morjaria, “The Value of Relationships: Evidence from Supply Shock to Kenyan Rose Exports,” American Economic Review 105, no. 9 (2015): 2911–45. 38 Wang Xiaodong, “Govt Issues Guidance for Quality of Products,” China Daily, updated September 14, 2017, accessed March 29, 2019, http://www.chinadaily.com.cn/china/2017-09/14/content_31975019.htm. 39 Gujanita Kalita, “The Emergence of Tirupur as the Export Hub of Knitted Garments in India: A Case Study,” ICRIER, accessed April 21, 2019, https://www.econ-jobs.com/research/52329-The-Emergence-of-Tirupur-as-the-Export-Hub-of-Knitted-Garments-in-India-A-Case-Study.pdf. 40 L.

Working in Public: The Making and Maintenance of Open Source Software by Nadia Eghbal

Amazon Web Services, Apollo 11, barriers to entry, Benevolent Dictator For Life (BDFL), Big Tech, bitcoin, Clayton Christensen, cloud computing, commoditize, commons-based peer production, context collapse, continuous integration, crowdsourcing, cryptocurrency, David Heinemeier Hansson, death of newspapers, Debian, disruptive innovation, Dunbar number, en.wikipedia.org, eternal september, Ethereum, Firefox, Free Software Foundation, Guido van Rossum, Hacker Ethic, Hacker News, Induced demand, informal economy, information security, Jane Jacobs, Jean Tirole, Kevin Kelly, Kickstarter, Kubernetes, leftpad, Mark Zuckerberg, Menlo Park, Neal Stephenson, Network effects, node package manager, Norbert Wiener, pirate software, pull request, RFC: Request For Comment, Richard Stallman, Ronald Coase, Ruby on Rails, side project, Silicon Valley, Snapchat, social graph, software as a service, Steve Jobs, Steve Wozniak, Steven Levy, Stewart Brand, tacit knowledge, the Cathedral and the Bazaar, The Death and Life of Great American Cities, The Nature of the Firm, TikTok, Tragedy of the Commons, transaction costs, two-sided market, urban planning, web application, wikimedia commons, Yochai Benkler, Zimmermann PGP

Decentralized communities prioritize work based on abundance of attention: encouraging new contributors, developing governance processes, and improving engagement and retention. But a creator prioritizes work based on scarcity of attention: saying no to contributions, closing out issues, reducing user support. While the commons is tasked with resolving coordination issues, creators are defined by the need for curation. Josh Lerner and Jean Tirole’s “The Simple Economics of Open Source” was published in 2000, but it contains analysis and observations that are still trenchant today. The widely cited paper questions whether the commons was ever tractable in open source, or just a temporary phenomenon: Can the management of open source projects accommodate the increasing number of contributors?

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Tague, “UNIX Time-Sharing System: Foreword,” The Bell System Technical Journal 57, no. 6 (1978): 1902, https://doi.org/10.1002/j.1538-7305.1978.tb02135.x. 118 Benkler, “Coase’s Penguin,” 379. 119 David Heinemeier Hansson, “The Perils of Mixing Open Source and Money,” November 12, 2013, https://dhh.dk/2013/the-perils-of-mixing-open-source-and-money.html. 120 Josh Lerner and Jean Tirole, “The Simple Economics of Open Source,” NBER Working Paper 7600, National Bureau of Economic Research, March 2000, 32, https://doi.org/10.3386/w7600. 121 Eugene Wei, “Status as a Service (StaaS),” Remains of the Day, February 19, 2019, https://www.eugenewei.com/blog/2019/2/19/status-as-a-service. 122 Michael Wesch, “YouTube and You: Experiences of Self-Awareness in the Context Collapse of the Recording Webcam,” Explorations in Media Ecology 8, no. 2 (2009): 19–34. 123 Robert E.

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An OSS Project-by-Project Typology,” in Proceedings of the 11th Working Conference on Mining Software Repositories - MSR 2014, chair Premkumar Devanbu (Hyderabad, India: Association for Computing Machinery, May 2014): 344–46, https://doi.org/10.1145/2597073.2597116. 163 Gustavo Pinto, Igor Steinmacher, and Marco Aurélio Gerosa, “More Common Than You Think: An In-Depth Study of Casual Contributors,” in 2016 IEEE 23rd International Conference on Software Analysis, Evolution, and Reengineering (SANER) (Suita, Japan: IEEE, March 2016), 518–528, https://doi.org/10.1109/saner.2016.68. 164 Igor Steinmacher, Igor Wiese, Ana Paula Chaves, and Marco Aurélio Gerosa, “Why Do Newcomers Abandon Open Source Software Projects?,” in 2013 6th International Workshop on Cooperative and Human Aspects of Software Engineering (CHASE) (IEEE: San Francisco, May 2013): 31, https://doi.org/10.1109/chase.2013.6614728. 165 Josh Lerner and Jean Tirole, “Some Simple Economics of Open Source,” The Journal of Industrial Economics 50, no. 2 (June 2002): 197–234, https://doi.org/10.1111/1467-6451.00174. 166 Nadia Eghbal, “The Rise of Few-Maintainer Projects,” Increment 9 (May 2019), https://increment.com/open-source/the-rise-of-few-maintainer-projects/. 167 Kraut and Resnick, Building Successful Online Communities, 205. 168 Christoph Hannebauer, Matthias Book, and Volker Gruhn, “An Exploratory Study of Contribution Barriers Experienced by Newcomers to Open Source Software Projects,” in Proceedings of the 1st International Workshop on CrowdSourcing in Software Engineering - CSI-SE 2014, chairs Gordon Fraser et al.

The Wealth of Networks: How Social Production Transforms Markets and Freedom by Yochai Benkler

affirmative action, AOL-Time Warner, barriers to entry, bioinformatics, Brownian motion, business logic, call centre, Cass Sunstein, centre right, clean water, commoditize, commons-based peer production, dark matter, desegregation, digital divide, East Village, Eben Moglen, fear of failure, Firefox, Free Software Foundation, game design, George Gilder, hiring and firing, Howard Rheingold, informal economy, information asymmetry, information security, invention of radio, Isaac Newton, iterative process, Jean Tirole, jimmy wales, John Markoff, John Perry Barlow, Kenneth Arrow, Lewis Mumford, longitudinal study, machine readable, Mahbub ul Haq, market bubble, market clearing, Marshall McLuhan, Mitch Kapor, New Journalism, optical character recognition, pattern recognition, peer-to-peer, power law, precautionary principle, pre–internet, price discrimination, profit maximization, profit motive, public intellectual, radical decentralization, random walk, Recombinant DNA, recommendation engine, regulatory arbitrage, rent-seeking, RFID, Richard Stallman, Ronald Coase, scientific management, search costs, Search for Extraterrestrial Intelligence, SETI@home, shareholder value, Silicon Valley, Skype, slashdot, social software, software patent, spectrum auction, subscription business, tacit knowledge, technological determinism, technoutopianism, The Fortune at the Bottom of the Pyramid, the long tail, The Nature of the Firm, the strength of weak ties, Timothy McVeigh, transaction costs, vertical integration, Vilfredo Pareto, work culture , Yochai Benkler

For an excellent history of the free software movement and of open-source development, see Glyn Moody, Rebel Code: Inside Linux and the Open Source Revolution (New York: Perseus Publishing, 2001). 19. Elinor Ostrom, Governing the Commons: The Evolution of Institutions for Collective Action (Cambridge: Cambridge University Press, 1990). 20. Josh Lerner and Jean Tirole, "The Scope of Open Source Licensing" (Harvard NOM working paper no. 02-42, table 1, Cambridge, MA, 2002). The figure is computed out of the data reported in this paper for the number of free software development projects that Lerner and Tirole identify as having "restrictive" or "very restrictive" licenses. 21.

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Being offered money to do something you know you "ought" to do, and that self-respecting members of society usually in fact do, implies that the person offering the money believes that you are not a well-adjusted human being or an equally respectable member of society. This causes the person offered the money either to believe the offerer, and thereby lose self-esteem and reduce effort, or to resent him and resist the offer. A similar causal explanation is formalized by Roland Benabou and Jean Tirole, who claim that the person receiving the monetary incentives infers that the person offering the compensation does not trust the offeree to do the right thing, or to do it well of their own accord. The offeree's self-confidence and intrinsic motivation to succeed are reduced to the extent that the offeree believes that the offerer--a manager or parent, for example--is better situated to judge the offeree's abilities. 34 188 More powerful than the theoretical literature is the substantial empirical literature--including field and laboratory experiments, econometrics, and surveys--that has developed since the mid-1990s to test the hypotheses of this model of human motivation.

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They are, rather, a sustainable pattern of human production given the characteristics of the networked information economy. The diversity of human motivation is nothing new. We now have a substantial literature documenting its importance in free and open-source software development projects, from Josh Lerner and Jean Tirole, Rishab Ghosh, Eric Von Hippel and Karim Lakhani, and others. Neither is the public goods nature of information new. What is new are the technological conditions that allow these facts to provide the ingredients of a much larger role in the networked information economy for nonmarket, nonproprietary production to emerge.

The Tyranny of Metrics by Jerry Z. Muller

Affordable Care Act / Obamacare, Atul Gawande, behavioural economics, Cass Sunstein, Checklist Manifesto, Chelsea Manning, collapse of Lehman Brothers, corporate governance, Credit Default Swap, crowdsourcing, delayed gratification, deskilling, Edward Snowden, Erik Brynjolfsson, financial engineering, Frederick Winslow Taylor, George Akerlof, Goodhart's law, Hyman Minsky, intangible asset, Jean Tirole, job satisfaction, joint-stock company, joint-stock limited liability company, Minsky moment, Moneyball by Michael Lewis explains big data, performance metric, price mechanism, RAND corporation, Salesforce, school choice, scientific management, Second Machine Age, selection bias, Steven Levy, tacit knowledge, TED Talk, total factor productivity, transaction costs, Tyler Cowen, WikiLeaks

For some are motivated less by extrinsic monetary rewards than by various sorts of intrinsic psychic rewards, including their commitment to the goals of the organizations for which they work, or a fascination with the complexity of the work they do, which makes it challenging, interesting, and entertaining. The existence of intrinsic as well as extrinsic motivations is obvious to anyone who has managed workers in complex tasks. It was articulated in the mid-1970s by psychologists, and has since been rediscovered and formalized by economists, including Jean Tirole, a recent recipient of the Nobel Prize for economics.8 It is simple-minded to assume that people are motivated only by the desire for more money, and naive to assume that they are motivated only by intrinsic rewards. The challenge is to figure out when each of these motivations is most effective, and in recent years social scientists have devoted attention to that issue.

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Rainey and Young Han Chun, “Public and Private Management Compared,” in Ewan Ferlie, Laurence E. Lynn, Jr., and Christopher Pollitt (eds.), The Oxford Handbook of Public Management (New York, 2005), pp. 72–102, 85; and James Q. Wilson, Bureaucracy: What Government Agencies Do and Why They Do It (New York, 2000), pp. 156–57. 8. Roland Bénabout and Jean Tirole, “Intrinsic and Extrinsic Motivation,” Review of Economic Studies no. 70 (2003), pp. 489–520. A pioneering work of intrinsic motivation theory was Edward L. Deci, Intrinsic Motivation (New York, 1975). Other studies by psychologists include Thane S. Pittman, Jolee Emery, and Ann K. Boggiano, “Intrinsic and Extrinsic Motivational Orientations: Reward-Induced Changes in Preference for Complexity,” Journal of Personality and Social Psychology 42, no. 5 (1982), pp. 789–97; and T.

10% Less Democracy: Why You Should Trust Elites a Little More and the Masses a Little Less by Garett Jones

Andrei Shleifer, Asian financial crisis, Brexit referendum, business cycle, central bank independence, clean water, corporate governance, correlation does not imply causation, creative destruction, Edward Glaeser, fake news, financial independence, game design, German hyperinflation, hive mind, invisible hand, James Carville said: "I would like to be reincarnated as the bond market. You can intimidate everybody.", Jean Tirole, Kenneth Rogoff, low interest rates, Mark Zuckerberg, mass incarceration, military-industrial complex, minimum wage unemployment, Mohammed Bouazizi, Neil Armstrong, open economy, Pareto efficiency, Paul Samuelson, price stability, rent control, Robert Solow, The Wealth of Nations by Adam Smith, trade liberalization, Tyler Cowen

., restricting the power of voters to punish government officials] is most desirable when (a) the electorate is poorly informed about the optimal action, (b) acquiring decision-relevant information is costly, and (c) feedback about the quality of decisions is slow. Therefore, technical decisions, in particular, may be best allocated to judges or appointed bureaucrats. ERIC MASKIN AND JEAN TIROLE PRINCETON’S ALAN BLINDER HAD a whirlwind career in Washington: President Clinton asked him to serve on his Council of Economic Advisers, and then eighteen months later, Blinder took the second most powerful job at the Federal Reserve: vice chair. Nineteen months after that, he was back at Princeton.

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Dataset Users’ Manual. Vienna, VA: Center for Systemic Peace. 2017. Marshall, Monty G., Ted Gurr, and Keith Jaggers. “Center for Systemic Peace: Polity IV Country Report 2010; Singapore.” Vienna, VA: Center for Systemic Peace, 2011. http://www.systemicpeace.org/polity/Singapore2010.pdf Maskin, Eric, and Jean Tirole. “The Politician and the Judge: Accountability in Government.” American Economic Review 94, no. 4 (2004): 1034–1054. Maurice, Eric. “EU Buries Migration Dispute for Now.” EU Observer, October 20, 2016. https://euobserver.com/migration/135576. Mayhew, David R. Congress: The Electoral Connection.

Liars and Outliers: How Security Holds Society Together by Bruce Schneier

Abraham Maslow, airport security, Alvin Toffler, barriers to entry, behavioural economics, benefit corporation, Berlin Wall, Bernie Madoff, Bernie Sanders, Brian Krebs, Broken windows theory, carried interest, Cass Sunstein, Chelsea Manning, commoditize, corporate governance, crack epidemic, credit crunch, CRISPR, crowdsourcing, cuban missile crisis, Daniel Kahneman / Amos Tversky, David Graeber, desegregation, don't be evil, Double Irish / Dutch Sandwich, Douglas Hofstadter, Dunbar number, experimental economics, Fall of the Berlin Wall, financial deregulation, Future Shock, Garrett Hardin, George Akerlof, hydraulic fracturing, impulse control, income inequality, information security, invention of agriculture, invention of gunpowder, iterative process, Jean Tirole, John Bogle, John Nash: game theory, joint-stock company, Julian Assange, language acquisition, longitudinal study, mass incarceration, meta-analysis, microcredit, mirror neurons, moral hazard, Multics, mutually assured destruction, Nate Silver, Network effects, Nick Leeson, off-the-grid, offshore financial centre, Oklahoma City bombing, patent troll, phenotype, pre–internet, principal–agent problem, prisoner's dilemma, profit maximization, profit motive, race to the bottom, Ralph Waldo Emerson, RAND corporation, Recombinant DNA, rent-seeking, RFID, Richard Thaler, risk tolerance, Ronald Coase, security theater, shareholder value, slashdot, statistical model, Steven Pinker, Stuxnet, technological singularity, The Market for Lemons, The Nature of the Firm, The Spirit Level, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, theory of mind, Timothy McVeigh, too big to fail, traffic fines, Tragedy of the Commons, transaction costs, ultimatum game, UNCLOS, union organizing, Vernor Vinge, WikiLeaks, World Values Survey, Y2K, Yochai Benkler, zero-sum game

reputation scale Avinash Dixit and Barry Nalebuff (1991), Thinking Strategically: The Competitive Edge in Business, Politics, and Everyday Life, Norton, 144–61. Criminals have signals Diego Gambetta (2009), Codes of the Underworld: How Criminals Communicate, Princeton University Press. Shared brand names Jean Tirole (1996), “A Theory of Collective Reputations (with Applications to the Persistence of Corruption and to Firm Quality),” Review of Economic Studies, 63:1–22. Saudi Binladin Group Holly Williams (20 Nov 2001), “Bin Laden Group Reputation Brief on Global Scale,” PR Week UK. pay a premium Stefano Castriota and Marco Delmastro (2009), “The Economics of Collective Reputation: Minimum Quality Standards, Vertical Differentiation, and Optimal Group Size,” American Association of Wine Economists Working Paper 50.

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September 11 attacks Nate Silver (4 Jan 2010), “The Skies Are as Friendly as Ever: 9/11, Al Qaeda Obscure Statistics on Airline Safety,” FiveThirtyEight.com. scale is too large Bruce Schneier (2008), “Seven Habits of Highly Unsuccessful Terrorists,” Wired News. Max Abrams (2008), “What Terrorists Really Want,” International Security, 32:78–105. regulatory capture Jean J. Laffont and Jean Tirole (1991), “The Politics of Government Decision-Making: A Theory of Regulatory Capture,” The Quarterly Journal of Economics, 106:1089–127. Mark Jickling (2004), “Barriers to Corporate Fraud: How They Work, Why They Fail,” CRS Report for Congress RL32718, Congressional Research Service. Dieter Helm (2006), “Regulatory Reform, Capture, and the Regulatory Burden,” Oxford Review of Economic Policy, 22:169–86.

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Patton, Natalie Smith, and David Tracer (2005), “'Economic Man' in Cross-Cultural Perspective: Behavioral Experiments in 15 Small-Scale Societies,” Behavioral & Brain Sciences, 28:795–855. Some researchers claim Ernst Fehr and Urs Fischbacher (2005), “Human Altruism: Proximate Patterns and Evolutionary Origins,” Analyse & Kritik, 27:6–47. Others claim Roland Bénabou and Jean Tirole (2006), “Incentives and Prosocial Behavior,” American Economic Review, 96:1652–78. Amihai Glazer and Kai A. Konrad (1996) “A Signaling Explanation for Charity,” American Economic Review, 86:1019–28. Dan Ariely, Anat Bracha, and Stephan Meier (2008), “Doing Good or Doing Well? Image Motivation and Monetary Incentives in Behaving Prosocially,” Federal Reserve Bank of Boston Working Paper No. 07–9.

We-Think: Mass Innovation, Not Mass Production by Charles Leadbeater

1960s counterculture, Andrew Keen, barriers to entry, bioinformatics, c2.com, call centre, citizen journalism, clean water, cloud computing, complexity theory, congestion charging, death of newspapers, Debian, digital divide, digital Maoism, disruptive innovation, double helix, Douglas Engelbart, Edward Lloyd's coffeehouse, folksonomy, frictionless, frictionless market, future of work, game design, Garrett Hardin, Google Earth, Google X / Alphabet X, Hacker Ethic, Herbert Marcuse, Hernando de Soto, hive mind, Howard Rheingold, interchangeable parts, Isaac Newton, James Watt: steam engine, Jane Jacobs, Jaron Lanier, Jean Tirole, jimmy wales, Johannes Kepler, John Markoff, John von Neumann, Joi Ito, Kevin Kelly, knowledge economy, knowledge worker, lateral thinking, lone genius, M-Pesa, Mark Shuttleworth, Mark Zuckerberg, Marshall McLuhan, Menlo Park, microcredit, Mitch Kapor, new economy, Nicholas Carr, online collectivism, Paradox of Choice, planetary scale, post scarcity, public intellectual, Recombinant DNA, Richard Stallman, Shoshana Zuboff, Silicon Valley, slashdot, social web, software patent, Steven Levy, Stewart Brand, supply-chain management, synthetic biology, the Cathedral and the Bazaar, The Death and Life of Great American Cities, the long tail, the market place, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Thomas Kuhn: the structure of scientific revolutions, Tragedy of the Commons, Whole Earth Catalog, work culture , Yochai Benkler, Zipcar

Page, The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and Societies (Princeton University Press, 2007) 16 Bart Nooteboom, Learning and Innovation in Organizations and Economies (Oxford University Press, 2000) 17 Steven Weber, The Success of Open Source (Cambridge, MA/London: Harvard University Press, 2004) 18 Articles by Lakhani, Ghosh and Lerner in Joseph Feller, Brian Fitzgerald, Scott A. Hissam, Karim R. Lakhani (Eds), Perspectives on Free and Open Source Software (Cambridge, MA: MIT Press, 2005) 19 Josh Lerner and Jean Tirole, ‘The Simple Economics of Open Source’, NBER Working Paper W7600 (2000). Available from http://www.nber.org/papers/w7600 20 Robert Wright, Nonzero (Abacus, 2001) 21 Carliss Y. Baldwin and Kim B. Clark, Design Rules (Cambridge, MA/London: MIT Press, 2000) Chapter 4 1 Richard Sennett, The Culture of the New Capitalism (New Haven, CT/London: Yale University Press, 2006) 2 Mitch Kapor, blog.kapor.com 3 Henry Chesbrough, Wim Vanhaverbeke and Joel West (Eds), Open Innovation: Researching a New Paradigm (Oxford University Press, 2006) 4 John Hartley, ‘Culture Business and the Value Chain of Meaning’, The New Economy, Creativity and Consumption – A Symposium (Brisbane: Queensland University of Technology Publications, 2002), pp. 39–46 5 http://www.blizzard.com/inblizz/profile.shtml 6 Nicolas Ducheneaut, Nicholas Yee, Eric Nickell and Robert J.

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, Guardian, 26 January 2006 Lane, Christel, and Reinhard Bachmann (Eds), Trust Within and Between Organizations (Oxford University Press, 1998) Larsson, Ulf (Ed), Cultures of Creativity (Canton, MA: Science History Publications, 2002) Leadbeater, Charles, ‘The DIY State’, Prospect 130, January 2007 Lencek, Lena, and Gideon Bosker, The Beach: The History of Paradise on Earth (New York: Penguin, 1999) Lerner, Josh, and Jean Tirole, ‘The Simple Economics of Open Source’, NBER Working Paper W7600 (2000). Available from http://www.nber.org/papers/w7600 Lessig, Lawrence, Code and Other Laws of Cyberspace (New York: Basic Books, 1999) Lessig, Lawrence, Free Culture (New York: Penguin Press, 2004) Lester, Richard K., and Michael Piore, Innovation: The Mission Dimension (Harvard University Press, 2004) Lethem, Jonathan, ‘The Ecstasy of Influence’, Harper’s Magazine, February 2007 Levine, Rick, Christopher Locke, Doc Searls and David Weinberger, The Cluetrain Manifesto (Perseus Books, 2000) Levy, Pierre and Robert Bonomo (trans), Collective Intelligence: Mankind’s Emerging World in Cyberspace (Perseus Books 1997) Levy, Steven, and Brad Stone, ‘The New Wisdom of the Web’, Newsweek, April 2006.

The Content Trap: A Strategist's Guide to Digital Change by Bharat Anand

Airbnb, Alan Greenspan, An Inconvenient Truth, AOL-Time Warner, Benjamin Mako Hill, Bernie Sanders, Clayton Christensen, cloud computing, commoditize, correlation does not imply causation, creative destruction, crowdsourcing, death of newspapers, disruptive innovation, Donald Trump, driverless car, electricity market, Eyjafjallajökull, fulfillment center, gamification, Google Glasses, Google X / Alphabet X, information asymmetry, Internet of things, inventory management, Jean Tirole, Jeff Bezos, John Markoff, Just-in-time delivery, Kaizen: continuous improvement, Khan Academy, Kickstarter, late fees, managed futures, Mark Zuckerberg, market design, Minecraft, multi-sided market, Network effects, post-work, price discrimination, publish or perish, QR code, recommendation engine, ride hailing / ride sharing, Salesforce, selection bias, self-driving car, shareholder value, Shenzhen special economic zone , Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Skype, social graph, social web, special economic zone, Stephen Hawking, Steve Jobs, Steven Levy, Stuart Kauffman, the long tail, Thomas L Friedman, transaction costs, two-sided market, ubercab, vertical integration, WikiLeaks, winner-take-all economy, zero-sum game

when it restricted its service Judd Cramer and Alan Krueger, “Disruptive Change in the Taxi Business: The Case of Uber,” National Bureau of Economic Research, Working Paper No. 22083, March 2016. “product versus platform” See also Jean-Charles Rochet and Jean Tirole, “Platform Competition in Two-Sided Markets,” Journal of the European Economic Association 1, No. 4 (June 2003), 990–1039; Mark Armstrong, “Competition in Two-Sided Markets,” RAND Journal of Economics , 37, no. 3 (Autumn 2006), 668–91; Jean-Charles Rochet and Jean Tirole, “Two-Sided Markets: A Progress Report,” RAND Journal of Economics , 37, no. 3 (Autumn 2006), 645–67. in 1996 Nick Statt, “Rare Pokemon Card Attracts Record-Breaking $50k Offers on eBay,” CNET , September 5, 2013.

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“Reproducing Knowledge: Replication Without Information at Moderate Complexity.” Organization Science 12, no. 3 (May–June 2001). Rob, Rafael, and Joel Waldfogel. “Piracy on the High C’s: Music Downloading, Sales Displacement, and Social Welfare in a Sample of College Students.” Journal of Law and Economics, 49, no. 1 (2006): 29–62. Rochet, Jean-Charles, and Jean Tirole. “Platform Competition in Two-Sided Markets.” Journal of the European Economic Association 1, no. 4 (June 2003): 990–1029. ———. “Two-Sided Markets: A Progress Report.” RAND Journal of Economics 37, no. 3 (Autumn 2006): 645–67. Rogers, Jim. The Death and Life of the Music Industry in the Digital Age.

Economists and the Powerful by Norbert Haring, Norbert H. Ring, Niall Douglas

accounting loophole / creative accounting, Affordable Care Act / Obamacare, Alan Greenspan, Albert Einstein, asset allocation, bank run, barriers to entry, Basel III, Bear Stearns, Bernie Madoff, book value, British Empire, buy and hold, central bank independence, collective bargaining, commodity trading advisor, compensation consultant, corporate governance, creative destruction, credit crunch, Credit Default Swap, David Ricardo: comparative advantage, diversified portfolio, financial deregulation, George Akerlof, illegal immigration, income inequality, inflation targeting, information asymmetry, Jean Tirole, job satisfaction, Joseph Schumpeter, Kenneth Arrow, knowledge worker, land bank, law of one price, light touch regulation, Long Term Capital Management, low interest rates, low skilled workers, mandatory minimum, market bubble, market clearing, market fundamentalism, means of production, military-industrial complex, minimum wage unemployment, Money creation, moral hazard, new economy, obamacare, old-boy network, open economy, Pareto efficiency, Paul Samuelson, pension reform, Ponzi scheme, price stability, principal–agent problem, profit maximization, purchasing power parity, Renaissance Technologies, Robert Solow, rolodex, Savings and loan crisis, Sergey Aleynikov, shareholder value, short selling, Steve Jobs, The Chicago School, the payments system, The Wealth of Nations by Adam Smith, too big to fail, Tragedy of the Commons, transaction costs, ultimatum game, union organizing, Vilfredo Pareto, working-age population, World Values Survey

The Economics of Discrimination. 2nd ed. Chicago: University of Chicago Press. . 1976. The Economic Approach to Human Behavior. Chicago: University of Chicago Press. Bellante, Don. 2004. “Edward Chamberlin: Monopolisitic Competition and Pareto Optimality.” Journal of Business and Economics Research 2: 17–28. Benabou, Roland and Jean Tirole. 2006. “Belief in a Just World and Redistributive Politics.” Quarterly Journal of Economics 121: 699–746. Benmelech, Efraim, Eugene Kandel and Pietro Veronesi. 2010. “Stock-Based Compensation and CEO (Dis)Incentives.” Quarterly Journal of Economics 125: 1769–1820. Benmelech, Efraim and Toby Moskowitz.

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McConnell. 2006. “Political Connections and Corporate Bailouts.” Journal of Finance 61: 2597–2635. Farber, Henry S. 2005. “What Do We Know About Job Loss in the United States: Evidence from the Displaced Workers Survey, 1984–2004.” Federal Reserve Bank of Chicago Regional Review: 13–28. Farhi, Emmanuel and Jean Tirole. 2009. “Collective Moral Hazard, Maturity Mismatch and Systemic Bailouts.” NBER Working Paper 15138. Farhi, Emmanuel and Iván Werning. 2008. “The Political Economy of Nonlinear Capital Taxation.” Working paper. Feenstra, Robert, Benjamin Mandel, Marshall B. Reisdorf and Matthew J. Slaughter. 2009.

The Great Reversal: How America Gave Up on Free Markets by Thomas Philippon

airline deregulation, Amazon Mechanical Turk, Amazon Web Services, Andrei Shleifer, barriers to entry, Big Tech, bitcoin, blockchain, book value, business cycle, business process, buy and hold, Cambridge Analytica, carbon tax, Carmen Reinhart, carried interest, central bank independence, commoditize, crack epidemic, cross-subsidies, disruptive innovation, Donald Trump, driverless car, Erik Brynjolfsson, eurozone crisis, financial deregulation, financial innovation, financial intermediation, flag carrier, Ford Model T, gig economy, Glass-Steagall Act, income inequality, income per capita, index fund, intangible asset, inventory management, Jean Tirole, Jeff Bezos, Kenneth Rogoff, labor-force participation, law of one price, liquidity trap, low cost airline, manufacturing employment, Mark Zuckerberg, market bubble, minimum wage unemployment, money market fund, moral hazard, natural language processing, Network effects, new economy, offshore financial centre, opioid epidemic / opioid crisis, Pareto efficiency, patent troll, Paul Samuelson, price discrimination, profit maximization, purchasing power parity, QWERTY keyboard, rent-seeking, ride hailing / ride sharing, risk-adjusted returns, Robert Bork, Robert Gordon, robo advisor, Ronald Reagan, search costs, Second Machine Age, self-driving car, Silicon Valley, Snapchat, spinning jenny, statistical model, Steve Jobs, stock buybacks, supply-chain management, Telecommunications Act of 1996, The Chicago School, the payments system, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, too big to fail, total factor productivity, transaction costs, Travis Kalanick, vertical integration, Vilfredo Pareto, warehouse automation, zero-sum game

The concern, however, is that a monopoly with full information can extract all the surplus. This is the fear expressed by Omarova. The key point here is that free entry becomes more important when firms increase price discrimination. Platforms use a variety of tools to limit competition, and sometimes that involves preventing price discrimination. Nobel Prize–winning economist Jean Tirole (2017) emphasizes the role of price coherence, also called the “most favored nation” clause. That name is a metaphor that comes from international trade agreements. The idea is that a platform will prevent its merchants from offering lower prices outside the platform. Online booking services require that restaurants or hotels not offer cheaper prices on their own websites.

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I have also benefited greatly from the insights of Ariel Burnstein, Luis Cabral, Gilbert Cette, Emmanuel Combe, Chiara Criscuolo, Jan De Loecker, Robin Döttling, Tomaso Duso, Rana Foroohar, Xavier Gabaix, Bob Hall, Erik Hurst, Seema Jayachandran, Sebnem Kalemli-Ozcan, Thomas Piketty, Howard Rosenthal, Tano Santos, Fiona Scott Morton, Dina Srinivasan, Johannes Stroebel, Jonathan Tepper, Jean Tirole, Nicolas Véron, David Wessel, Luigi Zingales, and Gabriel Zucman. I am grateful to Ian Malcolm and Mark Steinmeyer, who saw promise in my early ideas, to Rob Garver and Katherine Brick, who edited my dry and technical prose, to the team at Harvard University Press for their professionalism, and to the Smith Richardson Foundation for its support.

Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown by Philip Mirowski

"there is no alternative" (TINA), Adam Curtis, Alan Greenspan, Alvin Roth, An Inconvenient Truth, Andrei Shleifer, asset-backed security, bank run, barriers to entry, Basel III, Bear Stearns, behavioural economics, Berlin Wall, Bernie Madoff, Bernie Sanders, Black Swan, blue-collar work, bond market vigilante , bread and circuses, Bretton Woods, Brownian motion, business cycle, capital controls, carbon credits, Carmen Reinhart, Cass Sunstein, central bank independence, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, complexity theory, constrained optimization, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, dark matter, David Brooks, David Graeber, debt deflation, deindustrialization, democratizing finance, disinformation, do-ocracy, Edward Glaeser, Eugene Fama: efficient market hypothesis, experimental economics, facts on the ground, Fall of the Berlin Wall, financial deregulation, financial engineering, financial innovation, Flash crash, full employment, George Akerlof, Glass-Steagall Act, Goldman Sachs: Vampire Squid, Greenspan put, Hernando de Soto, housing crisis, Hyman Minsky, illegal immigration, income inequality, incomplete markets, information asymmetry, invisible hand, Jean Tirole, joint-stock company, junk bonds, Kenneth Arrow, Kenneth Rogoff, Kickstarter, knowledge economy, l'esprit de l'escalier, labor-force participation, liberal capitalism, liquidity trap, loose coupling, manufacturing employment, market clearing, market design, market fundamentalism, Martin Wolf, money market fund, Mont Pelerin Society, moral hazard, mortgage debt, Naomi Klein, Nash equilibrium, night-watchman state, Northern Rock, Occupy movement, offshore financial centre, oil shock, Pareto efficiency, Paul Samuelson, payday loans, Philip Mirowski, Phillips curve, Ponzi scheme, Post-Keynesian economics, precariat, prediction markets, price mechanism, profit motive, public intellectual, quantitative easing, race to the bottom, random walk, rent-seeking, Richard Thaler, road to serfdom, Robert Shiller, Robert Solow, Ronald Coase, Ronald Reagan, Savings and loan crisis, savings glut, school choice, sealed-bid auction, search costs, Silicon Valley, South Sea Bubble, Steven Levy, subprime mortgage crisis, tail risk, technoutopianism, The Chicago School, The Great Moderation, the map is not the territory, The Myth of the Rational Market, the scientific method, The Theory of the Leisure Class by Thorstein Veblen, The Wisdom of Crowds, theory of mind, Thomas Kuhn: the structure of scientific revolutions, Thorstein Veblen, Tobin tax, tontine, too big to fail, transaction costs, Tyler Cowen, vertical integration, Vilfredo Pareto, War on Poverty, Washington Consensus, We are the 99%, working poor

“The First Privatisation: Seeling SOEs and Privatizing Public Monopolies in Fascist Italy,” Cambridge Journal of Economics 35(5)(2011): 937-956. Benabou, Roland, and Jean Tirole. “Identity, Dignity and Taboos,” CEPR Discussion Paper 6123 (2007), available at www.vwl.tuwien.ac.at/hanappi/AgeSo/rp/Benabou_2007.pdf. Benabou, Roland, and Jean Tirole. “Self-Knowledge and Self-Regulation: An Economic Approach,” in I. Brocas and J. Carillo, eds., The Psychology of Economic Decisions, vol. 1 (Oxford: Oxford University Press, 2003), pp. 137–67. Benabou, Roland, and Jean Tirole. “Willpower and Personal Rules,” Journal of Political Economy 112 (2004): 848–86. Berg, Nathan, and Gerd Gigerenzer.

Misbehaving: The Making of Behavioral Economics by Richard H. Thaler

3Com Palm IPO, Alan Greenspan, Albert Einstein, Alvin Roth, Amazon Mechanical Turk, Andrei Shleifer, Apple's 1984 Super Bowl advert, Atul Gawande, behavioural economics, Berlin Wall, Bernie Madoff, Black-Scholes formula, book value, business cycle, capital asset pricing model, Cass Sunstein, Checklist Manifesto, choice architecture, clean water, cognitive dissonance, conceptual framework, constrained optimization, Daniel Kahneman / Amos Tversky, delayed gratification, diversification, diversified portfolio, Edward Glaeser, endowment effect, equity premium, equity risk premium, Eugene Fama: efficient market hypothesis, experimental economics, Fall of the Berlin Wall, George Akerlof, hindsight bias, Home mortgage interest deduction, impulse control, index fund, information asymmetry, invisible hand, Jean Tirole, John Nash: game theory, John von Neumann, Kenneth Arrow, Kickstarter, late fees, law of one price, libertarian paternalism, Long Term Capital Management, loss aversion, low interest rates, market clearing, Mason jar, mental accounting, meta-analysis, money market fund, More Guns, Less Crime, mortgage debt, Myron Scholes, Nash equilibrium, Nate Silver, New Journalism, nudge unit, PalmPilot, Paul Samuelson, payday loans, Ponzi scheme, Post-Keynesian economics, presumed consent, pre–internet, principal–agent problem, prisoner's dilemma, profit maximization, random walk, randomized controlled trial, Richard Thaler, risk free rate, Robert Shiller, Robert Solow, Ronald Coase, Silicon Valley, South Sea Bubble, Stanford marshmallow experiment, statistical model, Steve Jobs, sunk-cost fallacy, Supply of New York City Cabdrivers, systematic bias, technology bubble, The Chicago School, The Myth of the Rational Market, The Signal and the Noise by Nate Silver, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, transaction costs, ultimatum game, Vilfredo Pareto, Walter Mischel, zero-sum game

The second was developing theory. Economists were not going to take the field seriously until it had formal mathematical models that could incorporate the additional findings from psychology. With talented new behavioral economists entering the field, and even some well-established theorists such as Jean Tirole (the winner of the 2014 Nobel Prize) dabbling with behavioral models, there was continual progress on both fronts. But there was a third goal lurking in the background: could we use behavioral economics to make the world a better place? And could we do so without confirming the deeply held suspicions of our biggest critics: that we were closet socialists, if not communists, who wanted to replace markets with bureaucrats?

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Behavioural Insights Team. 2013. “Removing the Hassle Factor Associated with Loft Insulation: Results of a Behavioural Trial.” UK Department of Energy & Climate Change, September. Available at: https://www.gov.uk/government/publications/loft-clearance-results-of-a-behavioural-trial. Bénabou, Roland, and Jean Tirole. 2003. “Intrinsic and Extrinsic Motivation.” Review of Economic Studies 70, no. 3: 489–520. Benartzi, Shlomo, and Richard H. Thaler. 1995. “Myopic Loss Aversion and the Equity Premium Puzzle.” Quarterly Journal of Economics 110, no. 1: 73–92. ———. 1999. “Risk Aversion or Myopia? Choices in Repeated Gambles and Retirement Investments.”

People, Power, and Profits: Progressive Capitalism for an Age of Discontent by Joseph E. Stiglitz

affirmative action, Affordable Care Act / Obamacare, Alan Greenspan, AlphaGo, antiwork, barriers to entry, basic income, battle of ideas, behavioural economics, Berlin Wall, Bernie Madoff, Bernie Sanders, Big Tech, business cycle, Cambridge Analytica, Capital in the Twenty-First Century by Thomas Piketty, carbon tax, carried interest, central bank independence, clean water, collective bargaining, company town, corporate governance, corporate social responsibility, creative destruction, Credit Default Swap, crony capitalism, DeepMind, deglobalization, deindustrialization, disinformation, disintermediation, diversified portfolio, Donald Trump, driverless car, Edward Snowden, Elon Musk, Erik Brynjolfsson, fake news, Fall of the Berlin Wall, financial deregulation, financial innovation, financial intermediation, Firefox, Fractional reserve banking, Francis Fukuyama: the end of history, full employment, George Akerlof, gig economy, Glass-Steagall Act, global macro, global supply chain, greed is good, green new deal, income inequality, information asymmetry, invisible hand, Isaac Newton, Jean Tirole, Jeff Bezos, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John von Neumann, Joseph Schumpeter, labor-force participation, late fees, low interest rates, low skilled workers, Mark Zuckerberg, market fundamentalism, mass incarceration, meta-analysis, minimum wage unemployment, moral hazard, new economy, New Urbanism, obamacare, opioid epidemic / opioid crisis, patent troll, Paul Samuelson, pension reform, Peter Thiel, postindustrial economy, price discrimination, principal–agent problem, profit maximization, purchasing power parity, race to the bottom, Ralph Nader, rent-seeking, Richard Thaler, Robert Bork, Robert Gordon, Robert Mercer, Robert Shiller, Robert Solow, Ronald Reagan, Savings and loan crisis, search costs, secular stagnation, self-driving car, shareholder value, Shoshana Zuboff, Silicon Valley, Simon Kuznets, South China Sea, sovereign wealth fund, speech recognition, Steve Bannon, Steve Jobs, surveillance capitalism, TED Talk, The Chicago School, The Future of Employment, The Great Moderation, the market place, The Rise and Fall of American Growth, the scientific method, The Wealth of Nations by Adam Smith, too big to fail, trade liberalization, transaction costs, trickle-down economics, two-sided market, universal basic income, Unsafe at Any Speed, Upton Sinclair, uranium enrichment, War on Poverty, working-age population, Yochai Benkler

With other colleagues, we showed that the fight to be the monopolist didn’t necessarily have the positive effect on innovation that Schumpeter has assumed, but, on the contrary, could dampen it. See, for instance, Kenneth J. Arrow, “Economic Welfare and the Allocation of Resources to Invention,” and Drew Fudenberg, Richard Gilbert, Joseph E. Stiglitz, and Jean Tirole, “Preemption, Leapfrogging and Competition in Patent Races,” European Economic Review 22 (June 1983): 3–32 (Jean Tirole received the Nobel Memorial Prize in Economics in 2014). These conclusions have been reinforced by more recent results of Greenwald and Stiglitz, Creating a Learning Society, especially chapters 5 and 6. Arnold Harberger of the University of Chicago claimed that the loss in consumer welfare from monopoly power was of second-order importance (around 0.1 percent of GDP).

Adam Smith: Father of Economics by Jesse Norman

active measures, Alan Greenspan, Andrei Shleifer, balance sheet recession, bank run, banking crisis, Basel III, Bear Stearns, behavioural economics, Berlin Wall, Black Swan, Branko Milanovic, Bretton Woods, British Empire, Broken windows theory, business cycle, business process, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, centre right, cognitive dissonance, collateralized debt obligation, colonial exploitation, Corn Laws, Cornelius Vanderbilt, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, David Brooks, David Ricardo: comparative advantage, deindustrialization, electricity market, Eugene Fama: efficient market hypothesis, experimental economics, Fall of the Berlin Wall, Fellow of the Royal Society, financial engineering, financial intermediation, frictionless, frictionless market, future of work, George Akerlof, Glass-Steagall Act, Hyman Minsky, income inequality, incomplete markets, information asymmetry, intangible asset, invention of the telescope, invisible hand, Isaac Newton, Jean Tirole, John Nash: game theory, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, lateral thinking, loss aversion, low interest rates, market bubble, market fundamentalism, Martin Wolf, means of production, mirror neurons, money market fund, Mont Pelerin Society, moral hazard, moral panic, Naomi Klein, negative equity, Network effects, new economy, non-tariff barriers, Northern Rock, Pareto efficiency, Paul Samuelson, Peter Thiel, Philip Mirowski, price mechanism, principal–agent problem, profit maximization, public intellectual, purchasing power parity, random walk, rent-seeking, Richard Thaler, Robert Shiller, Robert Solow, Ronald Coase, scientific worldview, seigniorage, Socratic dialogue, South Sea Bubble, special economic zone, speech recognition, Steven Pinker, The Chicago School, The Myth of the Rational Market, The Nature of the Firm, The Rise and Fall of American Growth, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, theory of mind, Thomas Malthus, Thorstein Veblen, time value of money, transaction costs, transfer pricing, Veblen good, Vilfredo Pareto, Washington Consensus, working poor, zero-sum game

.), The Oxford Handbook on Professional Economic Ethics, Oxford University Press 2016. It is notable how far mainstream economists have started to draw on this wider cluster of ideas, as e.g. in two recent books by Nobel laureates: Edmund Phelps, Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change, Princeton University Press 2013; and Jean Tirole, Economics for the Common Good, Princeton University Press 2017 Inadequacy of genderless and raceless economics: Margherita Borella, Mariacristina De Nardi and Fang Yang, ‘The Aggregate Implications of Gender and Marriage’, Journal of the Economics of Ageing, 2017; Tomaz Cajner, Tyler Radler, David Ratner and Ivan Vidangos, ‘Racial Gaps in Labor Market Outcomes in the Last Four Decades and over the Business Cycle’, Washington DC, Federal Reserve System 2017 Husbandry: Julie A.

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Kenneth Boulding, ‘Economics as a Moral Science’, American Economic Review, 59.1, 1969: ‘It was… Veblen’s principal, and still largely unrecognized, contribution to formal economic theory, to point out that we cannot assume that tastes are “given” in any dynamic theory’ (my added inverted commas). As Boulding notes, when he was a student at Cambridge University this understanding of economics was still reflected in its status as part of the (now defunct) Moral Sciences Tripos Beliefs as property: Roland Bénabou and Jean Tirole, ‘Identity, Morals, and Taboos: Beliefs as Assets’, Quarterly Journal of Economics, 126. 2, 2011 The economy of regard: see Avner Offer, The Challenge of Affluence: Self-Control and Well-Being in the United States and Britain since 1950, Oxford University Press 2006, Ch. 6; and ‘Self-Interest, Sympathy and the Invisible Hand: From Adam Smith to Market Liberalism’, Economic Thought, 1.2, 2012 Parking tickets in New York: Raymond Fisman and Edward Miguel, ‘Cultures of Corruption: Evidence from Diplomatic Parking Tickets’, NBER Working Paper 12312, 2006.

The Future of Ideas: The Fate of the Commons in a Connected World by Lawrence Lessig

AltaVista, Andy Kessler, AOL-Time Warner, barriers to entry, Bill Atkinson, business process, Cass Sunstein, commoditize, computer age, creative destruction, dark matter, decentralized internet, Dennis Ritchie, disintermediation, disruptive innovation, Donald Davies, Erik Brynjolfsson, Free Software Foundation, Garrett Hardin, George Gilder, Hacker Ethic, Hedy Lamarr / George Antheil, history of Unix, Howard Rheingold, Hush-A-Phone, HyperCard, hypertext link, Innovator's Dilemma, invention of hypertext, inventory management, invisible hand, Jean Tirole, Jeff Bezos, John Gilmore, John Perry Barlow, Joseph Schumpeter, Ken Thompson, Kenneth Arrow, Larry Wall, Leonard Kleinrock, linked data, Marc Andreessen, Menlo Park, Mitch Kapor, Network effects, new economy, OSI model, packet switching, peer-to-peer, peer-to-peer model, price mechanism, profit maximization, RAND corporation, rent control, rent-seeking, RFC: Request For Comment, Richard Stallman, Richard Thaler, Robert Bork, Ronald Coase, Search for Extraterrestrial Intelligence, SETI@home, Silicon Valley, smart grid, software patent, spectrum auction, Steve Crocker, Steven Levy, Stewart Brand, systematic bias, Ted Nelson, Telecommunications Act of 1996, the Cathedral and the Bazaar, The Chicago School, tragedy of the anticommons, Tragedy of the Commons, transaction costs, vertical integration, Yochai Benkler, zero-sum game

.: O'Reilly, 1999), 151. 54 Wayner, 289. 55 “IBM Extends Software Leadership on Linux,” IBM Press Release, December 8, 2000. 56 Economists have only begun to examine the incentives that might affect open code projects. Josh Lerner and Jean Tirole have summarized some of the benefits, relative to closed code projects, as follows: (1) lower costs due to (a) familiarity of the code from, e.g., university training, and (b) customization/bug-fixing advantages; and (2) higher benefits, especially due to signaling from (a) better performance measurement (easier to demonstrate skill), (b) “full initiative” (because no supervisory involvement), and (c) greater labor market fluidity. See Josh Lerner and Jean Tirole, “The Simple Economics of Open Source” (NBER Working Paper No. 7600, December 2000).

Virtual Competition by Ariel Ezrachi, Maurice E. Stucke

"World Economic Forum" Davos, Airbnb, Alan Greenspan, Albert Einstein, algorithmic management, algorithmic trading, Arthur D. Levinson, barriers to entry, behavioural economics, cloud computing, collaborative economy, commoditize, confounding variable, corporate governance, crony capitalism, crowdsourcing, Daniel Kahneman / Amos Tversky, David Graeber, deep learning, demand response, Didi Chuxing, digital capitalism, disintermediation, disruptive innovation, double helix, Downton Abbey, driverless car, electricity market, Erik Brynjolfsson, Evgeny Morozov, experimental economics, Firefox, framing effect, Google Chrome, independent contractor, index arbitrage, information asymmetry, interest rate derivative, Internet of things, invisible hand, Jean Tirole, John Markoff, Joseph Schumpeter, Kenneth Arrow, light touch regulation, linked data, loss aversion, Lyft, Mark Zuckerberg, market clearing, market friction, Milgram experiment, multi-sided market, natural language processing, Network effects, new economy, nowcasting, offshore financial centre, pattern recognition, power law, prediction markets, price discrimination, price elasticity of demand, price stability, profit maximization, profit motive, race to the bottom, rent-seeking, Richard Thaler, ride hailing / ride sharing, road to serfdom, Robert Bork, Ronald Reagan, search costs, self-driving car, sharing economy, Silicon Valley, Skype, smart cities, smart meter, Snapchat, social graph, Steve Jobs, sunk-cost fallacy, supply-chain management, telemarketer, The Chicago School, The Myth of the Rational Market, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, Travis Kalanick, turn-by-turn navigation, two-sided market, Uber and Lyft, Uber for X, uber lyft, vertical integration, Watson beat the top human players on Jeopardy!, women in the workforce, yield management

., 509 U.S. 209 (1993); R. S. Khemani and D. M. Shapiro, Glossary of Industrial Organisation Economics and Competition Law (Paris: Organisation for Economic Cooperation and Development, 1993), http://www.oecd.org/dataoecd/8/61 /2376087.pdf. 2. Marc Ivaldi, Bruno Jullien, Patrick Rey, Paul Seabright, and Jean Tirole, “The Economics of Tacit Collusion,” Final Report for DG Competition (Toulouse: Eu ropean Commission, March 2003), 4, http://ec.europa .eu /competition/mergers/studies _ reports/the _ economics _of _tacit _ collusion _ en.pdf. 3. For a review of the economics of tacit collusion and the EU approach, see Nicolas Petit, “The ‘Oligopoly Problem’ in EU Competition Law” in Research Handbook in European Competition Law, Ioannis Liannos and Damien Geradin, eds.

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.,” New York Times, November 6, 2015, http://www.nytimes.com/2015/11/06 /technology/toyota-silicon-valley-artificial-intelligence-research-center.html ?_r = 0; Mui, “Google Is Millions of Miles Ahead of Apple in Driverless Cars.” See, e.g., Markoff, “Toyota Invests $1 Billion in Artificial Intelligence in U.S.” Jean Tirole, “Comments Made at FT-ETNO Summit 2015,” Financial Times (October 13, 2015), https://live.ft.com/Events/2015/FT-ETNO-Summit-2015. Stone, “Exclusive.” Matt Weinberger, “Microsoft Could See an Opportunity to Poke Google in the Eye with Uber Investment,” Business Insider UK (July 31, 2015), http://www.businessinsider.com/microsoft-and-google-are-uber-investors -2015-7.

Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State by Paul Tucker

"Friedman doctrine" OR "shareholder theory", Alan Greenspan, Andrei Shleifer, bank run, banking crisis, barriers to entry, Basel III, battle of ideas, Bear Stearns, Ben Bernanke: helicopter money, Berlin Wall, Bretton Woods, Brexit referendum, business cycle, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, centre right, conceptual framework, corporate governance, diversified portfolio, electricity market, Fall of the Berlin Wall, financial innovation, financial intermediation, financial repression, first-past-the-post, floating exchange rates, forensic accounting, forward guidance, Fractional reserve banking, Francis Fukuyama: the end of history, full employment, George Akerlof, Greenspan put, incomplete markets, inflation targeting, information asymmetry, invisible hand, iterative process, Jean Tirole, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, liberal capitalism, light touch regulation, Long Term Capital Management, low interest rates, means of production, Money creation, money market fund, Mont Pelerin Society, moral hazard, Northern Rock, operational security, Pareto efficiency, Paul Samuelson, price mechanism, price stability, principal–agent problem, profit maximization, public intellectual, quantitative easing, regulatory arbitrage, reserve currency, risk free rate, risk tolerance, risk-adjusted returns, road to serfdom, Robert Bork, Ronald Coase, seigniorage, short selling, Social Responsibility of Business Is to Increase Its Profits, stochastic process, subprime mortgage crisis, tail risk, The Chicago School, The Great Moderation, The Market for Lemons, the payments system, too big to fail, transaction costs, Vilfredo Pareto, Washington Consensus, yield curve, zero-coupon bond, zero-sum game

Brookings Papers on Economic Activity (2012): 233–97. DeMuth, Christopher. “Can the Administrative State Be Tamed.” Journal of Legal Analysis 8, no. 1 (2016): 121–90. de Waal, James. “Depending on the Right People: British Political-Military Relations 2001–2010.” London: Chatham House, 2013. Dewatripont, Mathias, Ian Jewitt, and Jean Tirole. “The Economics of Career Concerns, Part II: Application to Missions and Accountability of Government Agencies.” Review of Economic Studies 66, no. 1 (1999): 199–217. Dewey, John. The Public and Its Problems. Athens, OH: Swallow Press, 1954. Diamond, Douglas W., and P. H. Dybvig. “Bank Runs, Deposit Insurance, and Liquidity.”

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Eskridge, William N., and John Ferejohn. “Super-Statutes.” Duke Law Journal 50 (2001): 1215–76. Estlund, David. Democratic Authority. Princeton, NJ: Princeton University Press, 2008. ________. “Jeremy Waldron on Law and Disagreement.” Philosophical Studies 99 (2000): 111–28. Farhi, Emmanuel, and Jean Tirole. “Collective Moral Hazard, Maturity Mismatch, and Systemic Bailouts.” American Economic Review 102, no. 1 (2012): 60–93. Fawcett, Edmund. Liberalism: The Life of an Idea. Princeton, NJ: Princeton University Press, 2014. Feaver, Peter D. “Crisis as Shirking: An Agency Theory Explanation of the Souring of American Civil-Military Relations.”

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“Reflections on a Fourth Branch of Government.” Paper presented at Australasian Study of Parliament Group, 2013 Annual Conference. Mashaw, Jerry L. Creating the Administrative Constitution: The Lost One Hundred Years of American Administrative Law. New Haven, CT: Yale University Press, 2012. Maskin, Eric, and Jean Tirole. “The Politician and the Judge: Accountability in Government.” American Economic Review 94, no. 4 (2004): 1034–54. Mathews, Jud. “Proportionality Review in Administrative Law.” In Comparative Administrative Law, edited by Susan Rose-Ackerman and Peter Lindseth. 2nd ed. Cheltenham: Edward Elgar, 2017.

Drive: The Surprising Truth About What Motivates Us by Daniel H. Pink

Abraham Maslow, affirmative action, behavioural economics, call centre, Daniel Kahneman / Amos Tversky, Dean Kamen, deliberate practice, Firefox, Frederick Winslow Taylor, functional fixedness, game design, George Akerlof, Isaac Newton, Jean Tirole, job satisfaction, knowledge worker, longitudinal study, performance metric, profit maximization, profit motive, Results Only Work Environment, scientific management, side project, TED Talk, the built environment, Tony Hsieh, transaction costs, zero-sum game

Subramanyam, and Yuan Zhang, Earnings Guidance and Managerial Myopia, SSRN Working Paper No. 854515 , November 2005. Lisa D. Ordonez, Maurice E. Schweitzer, Adam D. Galinsky, and Max H. Braverman, Goals Gone Wild: The Systematic Side Effects of Over-Prescribing Goal Setting, Harvard Business School Working Paper No. 09-083 , February 2009. Roland BŽnabou and Jean Tirole, Intrinsic and Extrinsic Motivation, Review of Economic Studies 70 (2003). CHAPTER 2A. . . . AND THE SPECIAL CIRCUMSTANCES WHEN THEY DO Edward L. Deci, Richard Koestner, and Richard M. Ryan, Extrinsic Rewards and Intrinsic Motivation in Education: Reconsidered Once Again, Review of Educational Research 71, no. 1 (Spring 2001): 14.

The Euro and the Battle of Ideas by Markus K. Brunnermeier, Harold James, Jean-Pierre Landau

"there is no alternative" (TINA), Affordable Care Act / Obamacare, Alan Greenspan, asset-backed security, bank run, banking crisis, battle of ideas, Bear Stearns, Ben Bernanke: helicopter money, Berlin Wall, Bretton Woods, Brexit referendum, business cycle, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Celtic Tiger, central bank independence, centre right, collapse of Lehman Brothers, collective bargaining, credit crunch, Credit Default Swap, cross-border payments, currency peg, currency risk, debt deflation, Deng Xiaoping, different worldview, diversification, Donald Trump, Edward Snowden, en.wikipedia.org, Fall of the Berlin Wall, financial deregulation, financial repression, fixed income, Flash crash, floating exchange rates, full employment, Future Shock, German hyperinflation, global reserve currency, income inequality, inflation targeting, information asymmetry, Irish property bubble, Jean Tirole, Kenneth Rogoff, Les Trente Glorieuses, low interest rates, Martin Wolf, mittelstand, Money creation, money market fund, Mont Pelerin Society, moral hazard, negative equity, Neil Kinnock, new economy, Northern Rock, obamacare, offshore financial centre, open economy, paradox of thrift, pension reform, Phillips curve, Post-Keynesian economics, price stability, principal–agent problem, quantitative easing, race to the bottom, random walk, regulatory arbitrage, rent-seeking, reserve currency, risk free rate, road to serfdom, secular stagnation, short selling, Silicon Valley, South China Sea, special drawing rights, tail risk, the payments system, too big to fail, Tyler Cowen, union organizing, unorthodox policies, Washington Consensus, WikiLeaks, yield curve

Indeed, French academics have made a decisive contribution to the literature on time consistency and the consequent significance of the correct formulation of rules. In that sense, they have done more than the German Ordoliberals to present a version of a system of rules that is really applicable to the complexities of a modern economy, in which competition is not an obvious result of economic activity. Jean Tirole and Jean-Jacques Laffont in particular have been instrumental in developing a new approach to the provision of incentives by regulators, in which the dangers of creating moral hazard play a key role.44 The visions of the past influence the way that economics is seen. Most French economists complain—as did the recent best-selling author Thomas Piketty of Capital, a dramatic manifesto on how capitalism does not provide a self-sustaining and politically acceptable model of growth—that “economists are not highly respected in the academic and intellectual world or by political and financial elites.”45 In fact, a popular and intellectual culture exists that sees economists as narrow-minded and soulless technocrats who force a dehumanized concept of rationality on their fellow citizens.

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Charles Maier, “The Politics of Productivity: Foundations of American International Economic Policy after World War II,” in In Search of Stability: Explorations in Historical Political Economy, edited by Charles Maier (New York: Cambridge University Press), 121–52. 43. Pierre Bauby, L'Etat-stratège, (Paris: Les éditions ouvrières, 1991), 195. 44. Jean-Jacques Laffont and Jean Tirole, A Theory of Incentives in Regulation and Procurement (Cambridge, MA: MIT Press, 1993). In Germany, Hans-Werner Sinn also made a significant contribution to the analysis of the provision of public goods and built this position up as the basis for a critique of many of the Euro rescue mechanisms. 45.

The Bankers' New Clothes: What's Wrong With Banking and What to Do About It by Anat Admati, Martin Hellwig

Alan Greenspan, Andrei Shleifer, asset-backed security, bank run, banking crisis, Basel III, Bear Stearns, Bernie Madoff, Big bang: deregulation of the City of London, Black Swan, bonus culture, book value, break the buck, business cycle, Carmen Reinhart, central bank independence, centralized clearinghouse, collapse of Lehman Brothers, collateralized debt obligation, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, diversified portfolio, en.wikipedia.org, Exxon Valdez, financial deregulation, financial engineering, financial innovation, financial intermediation, fixed income, George Akerlof, Glass-Steagall Act, Growth in a Time of Debt, income inequality, information asymmetry, invisible hand, Jean Tirole, joint-stock company, joint-stock limited liability company, junk bonds, Kenneth Rogoff, Larry Wall, light touch regulation, London Interbank Offered Rate, Long Term Capital Management, margin call, Martin Wolf, Money creation, money market fund, moral hazard, mortgage debt, mortgage tax deduction, negative equity, Nick Leeson, Northern Rock, open economy, Paul Volcker talking about ATMs, peer-to-peer lending, proprietary trading, regulatory arbitrage, risk tolerance, risk-adjusted returns, risk/return, Robert Shiller, Satyajit Das, Savings and loan crisis, shareholder value, sovereign wealth fund, subprime mortgage crisis, technology bubble, The Market for Lemons, the payments system, too big to fail, Upton Sinclair, Yogi Berra

International Monetary Fund, Washington, DC. May 3. Demyanyk, Yuliya, and Otto Van Hemert. 2009. “Understanding the Subprime Mortgage Crisis.” Review of Financial Studies 24 (6): 1848–1880. Dermine, Jean. 1990. European Banking in the 1990s. Oxford, England: Blackwell. Dewatripont, Mathias, and Jean Tirole. 1994. The Prudential Regulation of Banks. Cambridge, MA: MIT Press. ———. “Macroeconomic Shocks and Banking Regulation.” Journal of Money, Credit, and Banking, forthcoming. Diamond, Douglas W. 1984. “Financial Intermediation and Delegated Monitoring.” Review of Economic Studies 51: 193–414. ———. 1991.

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“Bank CEO Incentives and the Credit Crisis.” Journal of Financial Economics 99: 11–26. Farber, David B., Marilyn F. Johnson, and Kathy R. Petroni. 2007. “Congressional Intervention in the Standard-Setting Process: An Analysis of the Stock Option Accounting Reform Act of 2004.” Accounting Horizons 21 (1): 1–22. Farhi, Emmanuel, and Jean Tirole. 2011. “Collective Moral Hazard, Maturity Mismatch, and Systemic Bailouts.” Working paper. Harvard University, Cambridge, MA, and Toulouse School of Economics, University of Toulouse, Toulouse, France. FCIC (Financial Crisis Inquiry Commission). 2011. The Financial Crisis Inquiry Report. Washington, DC: U.S.

Infotopia: How Many Minds Produce Knowledge by Cass R. Sunstein

affirmative action, Andrei Shleifer, availability heuristic, behavioural economics, Build a better mousetrap, c2.com, Cass Sunstein, cognitive bias, cuban missile crisis, Daniel Kahneman / Amos Tversky, Edward Glaeser, en.wikipedia.org, feminist movement, framing effect, Free Software Foundation, hindsight bias, information asymmetry, Isaac Newton, Jean Tirole, jimmy wales, market bubble, market design, minimum wage unemployment, prediction markets, profit motive, rent control, Richard Stallman, Richard Thaler, Robert Shiller, Ronald Reagan, Savings and loan crisis, slashdot, stem cell, systematic bias, Ted Sorensen, the Cathedral and the Bazaar, The Wisdom of Crowds, winner-take-all economy

Interested readers may enjoy Torvalds’s homepage; see http:// www.cs.helsinki.fi/u/torvalds/. 31. See Richard Stallman, “The GNU Operating System and the Free Software Movement,” in Open Sources: Voices from the Open Source Revolution, ed. Chris Dibona et al. (Sebastopol, CA: O’Reilly, 1999), 55–56. 32. Ibid., 57. 33. See Josh Lerner and Jean Tirole, “The Economics of Technology Sharing: Open Source and Beyond,” Journal of Economic Perspectives 19 (2005): 100. 34. Ibid. 254 / Notes to Pages 167–71 35. See Raymond, The Cathedral and the Bazaar. 36. Ibid., 21–22. 37. Here, too, I am grateful to Ethan Zuckerman for clarifying comments. 38. Eric Raymond, “Homesteading the Noosphere,” in The Cathedral and the Bazaar, 67, 81, 110. 39.

Cogs and Monsters: What Economics Is, and What It Should Be by Diane Coyle

3D printing, additive manufacturing, Airbnb, Al Roth, Alan Greenspan, algorithmic management, Amazon Web Services, autonomous vehicles, banking crisis, barriers to entry, behavioural economics, Big bang: deregulation of the City of London, biodiversity loss, bitcoin, Black Lives Matter, Boston Dynamics, Bretton Woods, Brexit referendum, business cycle, call centre, Carmen Reinhart, central bank independence, choice architecture, Chuck Templeton: OpenTable:, cloud computing, complexity theory, computer age, conceptual framework, congestion charging, constrained optimization, coronavirus, COVID-19, creative destruction, credit crunch, data science, DeepMind, deglobalization, deindustrialization, Diane Coyle, discounted cash flows, disintermediation, Donald Trump, Edward Glaeser, en.wikipedia.org, endogenous growth, endowment effect, Erik Brynjolfsson, eurozone crisis, everywhere but in the productivity statistics, Evgeny Morozov, experimental subject, financial deregulation, financial innovation, financial intermediation, Flash crash, framing effect, general purpose technology, George Akerlof, global supply chain, Goodhart's law, Google bus, haute cuisine, High speed trading, hockey-stick growth, Ida Tarbell, information asymmetry, intangible asset, Internet of things, invisible hand, Jaron Lanier, Jean Tirole, job automation, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, knowledge economy, knowledge worker, Les Trente Glorieuses, libertarian paternalism, linear programming, lockdown, Long Term Capital Management, loss aversion, low earth orbit, lump of labour, machine readable, market bubble, market design, Menlo Park, millennium bug, Modern Monetary Theory, Mont Pelerin Society, multi-sided market, Myron Scholes, Nash equilibrium, Nate Silver, Network effects, Occupy movement, Pareto efficiency, payday loans, payment for order flow, Phillips curve, post-industrial society, price mechanism, Productivity paradox, quantitative easing, randomized controlled trial, rent control, rent-seeking, ride hailing / ride sharing, road to serfdom, Robert Gordon, Robert Shiller, Robert Solow, Robinhood: mobile stock trading app, Ronald Coase, Ronald Reagan, San Francisco homelessness, savings glut, school vouchers, sharing economy, Silicon Valley, software is eating the world, spectrum auction, statistical model, Steven Pinker, tacit knowledge, The Chicago School, The Future of Employment, The Great Moderation, the map is not the territory, The Rise and Fall of American Growth, the scientific method, The Signal and the Noise by Nate Silver, the strength of weak ties, The Wealth of Nations by Adam Smith, total factor productivity, transaction costs, Uber for X, urban planning, winner-take-all economy, Winter of Discontent, women in the workforce, Y2K

I am grateful to many other colleagues in Cambridge and beyond for their comments and conversations helping stimulate my thinking at various stages through the years, including Matthew Agarwala, Anna Alexandrova, Eric Beinhocker, Tim Besley, Sam Bowles, John Bowers, Erik Brynjolfsson, Wendy Carlin, Vasco Carvalho, Jagjit Chadha, Carol Corrado, Jacques Crémer, Meredith Crowley, Partha Dasgupta, Mark Fabian, Marco Felici, Amelia Fletcher, Jason Furman, Tim Gardam, Rachel Griffith, Dennis Grube, Andrew Haldane, Jonathan Haskel, Cameron Hepburn, Cecilia Heyes, Bill Janeway, Dale Jorgenson, Saite Lu, Derek McAuley, Philip Marsden, David Miles, John Naughton, Jennifer Rubin, David Runciman, Paul Seabright, Margaret Stevens, Joseph Stiglitz, Jeni Tennison, Alex Teytelboym, Jean Tirole, Flavio Toxvaerd, Romesh Vaitilingam, Bart Van Ark, Tony Venables, Anna Vignoles, Dimitri Zenghelis. The biggest single influence on my economics career has been Professor Peter Sinclair, my undergraduate tutor at Brasenose College, Oxford, and a lifelong mentor and friend. He is the reason I became an economist, and he shaped the kind of economist I became.

The Middleman Economy: How Brokers, Agents, Dealers, and Everyday Matchmakers Create Value and Profit by Marina Krakovsky

Affordable Care Act / Obamacare, Airbnb, Al Roth, Ben Horowitz, Benchmark Capital, Black Swan, buy low sell high, Chuck Templeton: OpenTable:, Credit Default Swap, cross-subsidies, crowdsourcing, deal flow, disintermediation, diversified portfolio, experimental economics, George Akerlof, Goldman Sachs: Vampire Squid, income inequality, index fund, information asymmetry, Jean Tirole, Joan Didion, John Zimmer (Lyft cofounder), Kenneth Arrow, Lean Startup, Lyft, Marc Andreessen, Mark Zuckerberg, market microstructure, Martin Wolf, McMansion, Menlo Park, Metcalfe’s law, moral hazard, multi-sided market, Network effects, patent troll, Paul Graham, Peter Thiel, pez dispenser, power law, real-name policy, ride hailing / ride sharing, Robert Metcalfe, Sand Hill Road, search costs, seminal paper, sharing economy, Silicon Valley, social graph, supply-chain management, TaskRabbit, the long tail, The Market for Lemons, the strength of weak ties, too big to fail, trade route, transaction costs, two-sided market, Uber for X, uber lyft, ultimatum game, Y Combinator

Stein, “Banks as Liquidity Providers: An Explanation for the Coexistence of Lending and Deposit Taking,” The Journal of Finance 57, no. 1 (February 2002): 33–73. 33.Interview with Genevieve Thiers, January 27, 2014. 34.Libby Kane, “Entrepreneurship 101: Interview with Genevieve Thiers,” LearnVest, September 12, 2012. 35.Interview with Marc Rysman, January 31, 2014. Rysman’s contribution to the literature is Marc Rysman, “The Economics of Two-Sided Markets,” Journal of Economic Perspectives 23, no. 3 (2009). Another survey paper is Jean-Charles Rochet and Jean Tirole, “Two-sided Markets: A Progress Report,” RAND Journal of Economics 37, no. 3 (September 2006): 646–67. The classic paper describing increasing returns to scale is W. Brian Arthur, “Competing Technologies, Increasing Returns, and Lock-In By Historical Events,” The Economic Journal 99, no. 394 (March 1989).

Who Gets What — and Why: The New Economics of Matchmaking and Market Design by Alvin E. Roth

Affordable Care Act / Obamacare, Airbnb, algorithmic trading, barriers to entry, behavioural economics, Berlin Wall, bitcoin, Build a better mousetrap, centralized clearinghouse, Chuck Templeton: OpenTable:, commoditize, computer age, computerized markets, crowdsourcing, deferred acceptance, desegregation, Dutch auction, experimental economics, first-price auction, Flash crash, High speed trading, income inequality, Internet of things, invention of agriculture, invisible hand, Jean Tirole, law of one price, Lyft, market clearing, market design, medical residency, obamacare, PalmPilot, proxy bid, road to serfdom, school choice, sealed-bid auction, second-price auction, second-price sealed-bid, Silicon Valley, spectrum auction, Spread Networks laid a new fibre optics cable between New York and Chicago, Steve Jobs, The Wealth of Nations by Adam Smith, two-sided market, uber lyft, undersea cable

. [>] Credit cards offered merchants: Credit cards are sometimes referred to by economists as “two-sided markets” because of the way they form a marketplace that needs to attract two different kinds of participants: merchants and consumers. One important strand of work focuses on how the two sides of the service should be priced; see, for example, Jean-Charles Rochet and Jean Tirole, “Two-Sided Markets: A Progress Report,” RAND Journal of Economics 37, no. 3 (Autumn 2006): 645–67. [>] they seldom switch cards: See Lawrence M. Ausubel, “The Failure of Competition in the Credit Card Market,” American Economic Review 81, no. 1 (March 1991): 50–81. [>] middlemen: For competition among middlemen, see Benjamin Edelman and Julian Wright, “Price Coherence and Adverse Intermediation” (working paper, Harvard Business School, Cambridge, MA, December 2013). 3.

Thinking in Bets by Annie Duke

banking crisis, behavioural economics, Bernie Madoff, Cass Sunstein, cognitive bias, cognitive dissonance, cognitive load, Daniel Kahneman / Amos Tversky, delayed gratification, Demis Hassabis, disinformation, Donald Trump, Dr. Strangelove, en.wikipedia.org, endowment effect, Estimating the Reproducibility of Psychological Science, fake news, Filter Bubble, Herman Kahn, hindsight bias, Jean Tirole, John Nash: game theory, John von Neumann, loss aversion, market design, mutually assured destruction, Nate Silver, p-value, phenotype, prediction markets, Richard Feynman, ride hailing / ride sharing, Stanford marshmallow experiment, Stephen Hawking, Steven Pinker, systematic bias, TED Talk, the scientific method, The Signal and the Noise by Nate Silver, urban planning, Walter Mischel, Yogi Berra, zero-sum game

Schelling (2005, game theory, “for having enhanced our understanding of conflict and cooperation through game theory analysis”); (6) Leonid Hurwicz, (7) Eric S. Maskin, and (8) Roger B. Myerson (2007, microeconomics, “for having laid the foundations of mechanism design theory”); (9) Alvin E. Roth and (10) Lloyd S. Shapley (2012, applied game theory, “for the theory of stable allocations and the practice of market design”); and (11) Jean Tirole (2014, industrial organization, microeconomics, “for his analysis of market power and regulation”). Poker vs. chess: My brother Howard came from a chess background, but the movement of players from chess into poker is relatively rare. In my opinion, the lack of uncertainty in chess compared with the great uncertainty in poker is a barrier to transitioning from one to the other.

The Future of Capitalism: Facing the New Anxieties by Paul Collier

"Friedman doctrine" OR "shareholder theory", accounting loophole / creative accounting, Airbnb, An Inconvenient Truth, assortative mating, bank run, Bear Stearns, behavioural economics, Berlin Wall, Bernie Sanders, bitcoin, Bob Geldof, bonus culture, business cycle, call centre, central bank independence, centre right, commodity super cycle, computerized trading, corporate governance, creative destruction, cuban missile crisis, David Brooks, delayed gratification, deskilling, Donald Trump, eurozone crisis, fake news, financial deregulation, full employment, George Akerlof, Goldman Sachs: Vampire Squid, greed is good, income inequality, industrial cluster, information asymmetry, intangible asset, Jean Tirole, Jeremy Corbyn, job satisfaction, John Perry Barlow, Joseph Schumpeter, knowledge economy, late capitalism, loss aversion, Mark Zuckerberg, minimum wage unemployment, moral hazard, negative equity, New Urbanism, Northern Rock, offshore financial centre, out of africa, Peace of Westphalia, principal–agent problem, race to the bottom, rent control, rent-seeking, rising living standards, Robert Shiller, Robert Solow, Ronald Reagan, shareholder value, Silicon Valley, Silicon Valley ideology, sovereign wealth fund, The Wealth of Nations by Adam Smith, theory of mind, too big to fail, trade liberalization, urban planning, web of trust, zero-sum game

There has, however, to be a limit to such security; while firms should be able to cope with temporary fluctuations, they cannot adjust to a large, permanent drop in demand without shedding labour. At the limit, the firm goes bankrupt. Yet the fact that job loss is unavoidable in no way mitigates the cost to the worker. For this class of shock, we need an entity larger than the firm – the state. Nobel Laureate Jean Tirole has proposed a smart way for government to induce firms to retain workers through market troughs, while still enabling them to shed employees when faced by a permanent contraction. This is to impose a charge on labour-shedding to reflect the extra costs to the state of welfare payments and retraining.

After the Gig: How the Sharing Economy Got Hijacked and How to Win It Back by Juliet Schor, William Attwood-Charles, Mehmet Cansoy

1960s counterculture, Airbnb, algorithmic management, Amazon Mechanical Turk, American Legislative Exchange Council, back-to-the-land, barriers to entry, bike sharing, Californian Ideology, carbon footprint, clean tech, collaborative consumption, collaborative economy, Community Supported Agriculture, COVID-19, creative destruction, crowdsourcing, deskilling, driverless car, en.wikipedia.org, financial independence, future of work, gentrification, George Gilder, gig economy, global supply chain, global village, haute cuisine, income inequality, independent contractor, information asymmetry, Intergovernmental Panel on Climate Change (IPCC), Jean Tirole, Jeff Bezos, jitney, job satisfaction, John Perry Barlow, John Zimmer (Lyft cofounder), Kevin Kelly, Lyft, Marshall McLuhan, Mason jar, mass incarceration, Mitch Kapor, Network effects, new economy, New Urbanism, Occupy movement, peer-to-peer rental, Post-Keynesian economics, precariat, profit maximization, profit motive, race to the bottom, regulatory arbitrage, rent gap, rent-seeking, ride hailing / ride sharing, Ruby on Rails, selection bias, sharing economy, Silicon Valley, Silicon Valley ideology, Skype, smart cities, social distancing, Stewart Brand, TaskRabbit, technological determinism, technoutopianism, Telecommunications Act of 1996, The Nature of the Firm, the payments system, Tragedy of the Commons, transaction costs, transportation-network company, Travis Kalanick, two-sided market, Uber and Lyft, Uber for X, uber lyft, urban planning, wage slave, walking around money, Whole Earth Catalog, women in the workforce, working poor, Yochai Benkler, Zipcar

Geoforum 67 (December): 121–29. Ritzer, George. 2007. The McDonaldization of Society. 2nd ed. Thousand Oaks, CA: Pine Forge. Robinson, H. C. 2017. “Making a Digital Working Class: Uber Drivers in Boston, 2016–2017.” PhD diss., MIT Program in Science, Technology and Society. Rochet, Jean-Charles, and Jean Tirole. 2003. “Platform Competition in Two-Sided Markets.” Journal of the European Economic Association 1 (4): 990–1029. Rogers, Brishen. 2015. “The Social Costs of Uber.” University of Chicago Law Review 82:85–102. ———. 2016. “Employment Rights in the Platform Economy: Getting Back to Basics.” Harvard Law and Policy Review 10:479–520. ———. 2018.

The Upside of Irrationality: The Unexpected Benefits of Defying Logic at Work and at Home by Dan Ariely

Alvin Roth, An Inconvenient Truth, assortative mating, Bear Stearns, behavioural economics, Burning Man, business process, cognitive dissonance, Cornelius Vanderbilt, corporate governance, Daniel Kahneman / Amos Tversky, Demis Hassabis, end world poverty, endowment effect, Exxon Valdez, first-price auction, Ford Model T, Frederick Winslow Taylor, George Akerlof, happiness index / gross national happiness, hedonic treadmill, IKEA effect, Jean Tirole, job satisfaction, knowledge economy, knowledge worker, loss aversion, name-letter effect, Peter Singer: altruism, placebo effect, Richard Thaler, Saturday Night Live, search costs, second-price auction, Skinner box, software as a service, subprime mortgage crisis, sunk-cost fallacy, The Wealth of Nations by Adam Smith, ultimatum game, Upton Sinclair, young professional

Additional readings Eduardo Andrade and Teck-Hua Ho, “Gaming Emotions in Social Interactions,” Journal of Consumer Research 36, no. 4 (2009): 539–552. Dan Ariely, Anat Bracha, and Stephan Meier, “Doing Good or Doing Well? Image Motivation and Monetary Incentives in Behaving Prosocially,” American Economic Review 99, no. 1 (2009): 544–545. Roland Bénabou and Jean Tirole, “Incentives and Prosocial Behavior,” American Economic Review 96, no. 5 (2006): 1652–1678. Ronit Bodner and Dražen Prelec, “Self-Signaling and Diagnostic Utility in Everyday Decision Making,” in Psychology of Economic Decisions, vol. 1, ed. Isabelle Brocas and Juan Carrillo (New York: Oxford University Press, 2003).

Straight Talk on Trade: Ideas for a Sane World Economy by Dani Rodrik

3D printing, airline deregulation, Asian financial crisis, bank run, barriers to entry, behavioural economics, Berlin Wall, Bernie Sanders, blue-collar work, Bretton Woods, BRICs, business cycle, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, carbon tax, Carmen Reinhart, carried interest, central bank independence, centre right, collective bargaining, conceptual framework, continuous integration, corporate governance, corporate social responsibility, currency manipulation / currency intervention, David Ricardo: comparative advantage, deindustrialization, Donald Trump, endogenous growth, Eugene Fama: efficient market hypothesis, eurozone crisis, export processing zone, failed state, financial deregulation, financial innovation, financial intermediation, financial repression, floating exchange rates, full employment, future of work, general purpose technology, George Akerlof, global value chain, income inequality, inflation targeting, information asymmetry, investor state dispute settlement, invisible hand, Jean Tirole, Kenneth Rogoff, low interest rates, low skilled workers, manufacturing employment, market clearing, market fundamentalism, meta-analysis, moral hazard, Nelson Mandela, new economy, offshore financial centre, open borders, open economy, open immigration, Pareto efficiency, postindustrial economy, precautionary principle, price stability, public intellectual, pushing on a string, race to the bottom, randomized controlled trial, regulatory arbitrage, rent control, rent-seeking, Richard Thaler, Robert Gordon, Robert Shiller, Ronald Reagan, Sam Peltzman, Silicon Valley, Solyndra, special economic zone, spectrum auction, Steven Pinker, tacit knowledge, The Rise and Fall of American Growth, the scientific method, The Wealth of Nations by Adam Smith, Thomas L Friedman, too big to fail, total factor productivity, trade liberalization, transaction costs, Tyler Cowen, unorthodox policies, Washington Consensus, World Values Survey, zero-sum game, éminence grise

CHAPTER 7: Economists, Politics, and Ideas 1. George J. Stigler, “The Theory of Economic Regulation,” Bell Journal of Economics and Management Science, vol. 2(1), Spring 1971: 3–21; Sam Peltzman, “Toward a More General Theory of Regulation,” Journal of Law and Economics, vol. 19(2), 1976: 211–240; Jean-Jacques Laffont and Jean Tirole “The Politics of Government Decision Making: A Theory of Regulatory Capture,” Quarterly Journal of Economics, vol. 106, 1991: 1089–1127. 2. Anne O. Krueger, “The Political Economy of the Rent-Seeking Society,” American Economic Review, vol. 64(3), June 1974: 291–303; Gene Grossman and Elhanan Helpman, “Protection for Sale,” American Economic Review, vol. 84(4), 1994: 833; Dani Rodrik, “The Political Economy of Trade Policy,” in Handbook of International Economics, G.

Laziness Does Not Exist by Devon Price

Affordable Care Act / Obamacare, call centre, coronavirus, COVID-19, data science, demand response, Donald Trump, emotional labour, fake news, financial independence, Firefox, gamification, gig economy, Google Chrome, helicopter parent, impulse control, Jean Tirole, job automation, job satisfaction, Lyft, meta-analysis, Minecraft, New Journalism, off-the-grid, pattern recognition, prosperity theology / prosperity gospel / gospel of success, randomized controlled trial, remote working, Saturday Night Live, selection bias, side hustle, side project, Silicon Valley, social distancing, strikebreaker, TaskRabbit, TikTok, traumatic brain injury, uber lyft, working poor

Megan Garber, “The Perils of Meritocracy,” Atlantic, June 30, 2017, https://www.theatlantic.com/entertainment/archive/2017/06/the-perils-of-meritocracy/532215/. 30. Melvin J. Lerner, “The Two Forms of Belief in a Just World,” in Responses to Victimizations and Belief in a Just World (Boston: Springer, 1998), 247–69. 31. Roland Bénabou and Jean Tirole, “Belief in a Just World and Redistributive Politics,” Quarterly Journal of Economics 121, no. 2, 699–746. 32. “Common Portrayals of Persons with Disabilities,” Media Smarts, August 22, 2014, http://mediasmarts.ca/diversity-media/persons-disabilities/common-portrayals-persons-disabilities. 33.

The Price of Everything: And the Hidden Logic of Value by Eduardo Porter

Alan Greenspan, Alvin Roth, AOL-Time Warner, Asian financial crisis, Ayatollah Khomeini, banking crisis, barriers to entry, behavioural economics, Berlin Wall, British Empire, capital controls, carbon tax, Carmen Reinhart, Cass Sunstein, clean water, Credit Default Swap, Deng Xiaoping, Easter island, Edward Glaeser, European colonialism, Fall of the Berlin Wall, financial deregulation, financial engineering, flying shuttle, Ford paid five dollars a day, full employment, George Akerlof, Glass-Steagall Act, Gordon Gekko, guest worker program, happiness index / gross national happiness, housing crisis, illegal immigration, immigration reform, income inequality, income per capita, informal economy, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Jean Tirole, John Maynard Keynes: technological unemployment, Joshua Gans and Andrew Leigh, junk bonds, Kenneth Rogoff, labor-force participation, laissez-faire capitalism, longitudinal study, loss aversion, low skilled workers, Martin Wolf, means of production, Menlo Park, Mexican peso crisis / tequila crisis, Michael Milken, Monkeys Reject Unequal Pay, new economy, New Urbanism, peer-to-peer, pension reform, Peter Singer: altruism, pets.com, placebo effect, precautionary principle, price discrimination, price stability, rent-seeking, Richard Thaler, rising living standards, risk tolerance, Robert Shiller, Ronald Reagan, search costs, Silicon Valley, stem cell, Steve Jobs, Stewart Brand, superstar cities, The Spirit Level, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, trade route, transatlantic slave trade, ultimatum game, unpaid internship, urban planning, Veblen good, women in the workforce, World Values Survey, Yom Kippur War, young professional, zero-sum game

The analysis of the relationship between the price of labor and the availability of services is in Robert Lipsey and Birgitta Swedenborg, “High-Price and Low-Price Countries: Causes and Consequences of Product Price Differences Across Countries,” University of Pennsylvania Workshop Presentation, 2008; Robert Lipsey and Birgitta Swedenborg, “Explaining Product Price Differences Across Countries,” NBER Working Paper, July 2007; and Robert Lipsey and Birgitta Swedenborg, “Wage Dispersion and Country Price Levels,” NBER Working Paper, 1997. The commentary on the different views on fairness and luck in Europe and the United States draws from Roland Benabou and Jean Tirole, “Belief in a Just World and Redistributive Politics,” NBER Working Paper, March 2005; and World Values Survey, 2005-2008 wave (http://www.wvsevsdb.com/wvs/WVSAnalizeStudy.jsp, accessed 08/09/2010). The discussion on racial diversity and support for redistributive policies draws from William Julius Wilson, When Work Disappears: The World of the New Urban Poor (New York: Vintage Books, 1997), p. 202.

Revolution Française: Emmanuel Macron and the Quest to Reinvent a Nation by Sophie Pedder

"World Economic Forum" Davos, Airbnb, Berlin Wall, Bernie Sanders, bike sharing, carbon tax, centre right, clean tech, DeepMind, disruptive innovation, Donald Trump, Downton Abbey, driverless car, Erik Brynjolfsson, eurozone crisis, failed state, fake news, Fall of the Berlin Wall, Future Shock, ghettoisation, growth hacking, haute couture, Jean Tirole, knowledge economy, liberal capitalism, mass immigration, mittelstand, new economy, post-industrial society, public intellectual, rent-seeking, ride hailing / ride sharing, Second Machine Age, sharing economy, Sheryl Sandberg, Silicon Valley, Tony Fadell, Travis Kalanick, urban planning, éminence grise

Yet, across all disciplines, 82 per cent of undergraduates got their degree in three years. During the student revolt, the Toulouse 1 campus was shut for just a brief period. In the Toulouse School of Economics (TSE), a faculty within the university, it has a world-class department of economics. One of the TSE pioneers, Jean Tirole, won the 2014 Nobel Prize in this field. Indeed, the history of the TSE, which arose from an institute originally set up in 1990 by Jean-Jacques Laffont, shows both how France has tied its hands with the existing system, and how to circumvent it. Instead of accepting its lot, the school’s founders decided to work around the rules.

Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism by George A. Akerlof, Robert J. Shiller

affirmative action, Andrei Shleifer, asset-backed security, bank run, banking crisis, Bear Stearns, behavioural economics, business cycle, buy and hold, collateralized debt obligation, conceptual framework, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, Deng Xiaoping, Donald Trump, Edward Glaeser, en.wikipedia.org, experimental subject, financial innovation, full employment, Future Shock, George Akerlof, George Santayana, housing crisis, Hyman Minsky, income per capita, inflation targeting, invisible hand, Isaac Newton, Jane Jacobs, Jean Tirole, job satisfaction, Joseph Schumpeter, junk bonds, Long Term Capital Management, loss aversion, market bubble, market clearing, mental accounting, Michael Milken, Mikhail Gorbachev, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, mortgage debt, Myron Scholes, new economy, New Urbanism, Paul Samuelson, Phillips curve, plutocrats, Post-Keynesian economics, price stability, profit maximization, public intellectual, purchasing power parity, random walk, Richard Thaler, Robert Shiller, Robert Solow, Ronald Reagan, Savings and loan crisis, seminal paper, South Sea Bubble, The Chicago School, The Death and Life of Great American Cities, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, tulip mania, W. E. B. Du Bois, We are all Keynesians now, working-age population, Y2K, Yom Kippur War

Institute for the Study of Labor Discussion Paper 959. Becker, Gary S. 1968. “Crime and Punishment: An Economic Approach.” Journal of Political Economy 76:169–217. Benabou, Roland. 2008. “Groupthink: Collective Delusions in Organizations and Markets.” Unpublished paper, Princeton University. Benabou, Roland, and Jean Tirole. 2000. “Self-Confidence and Social Interactions.” National Bureau of Economic Research Working Paper 7585, March. Benoit, Bernard, Ben Hall, Krishna Guha, Francesco Guerrera, and Henry Sender. 2008. “US Prepares $250bn Banks Push; Global Rebound; S&P 500 Soars 11.6 % as Markets Cheer Europe’s $2,546bn Move.”

Top Dog: The Science of Winning and Losing by Po Bronson, Ashley Merryman

Asperger Syndrome, Berlin Wall, Charles Lindbergh, conceptual framework, crowdsourcing, delayed gratification, deliberate practice, Edward Glaeser, experimental economics, Fall of the Berlin Wall, fear of failure, FedEx blackjack story, Ford Model T, game design, industrial cluster, Jean Tirole, knowledge worker, Larry Ellison, longitudinal study, loss aversion, Mark Zuckerberg, meta-analysis, Mikhail Gorbachev, phenotype, Richard Feynman, risk tolerance, school choice, selection bias, shareholder value, Silicon Valley, six sigma, Steve Jobs, the Cathedral and the Bazaar, work culture , zero-sum game

Magazine’s 500 Fastest-Growing Companies in America for Second Consecutive Year,” Press Release (8/27/2008) Moon, Jae Yun, & Lee Sproull, “Essence of Distributed Work: The Case of the Linux Kernel,” First Monday, vol. 5(11) (2000) Noyes, Kathleen, “Top Honor for Linus Torvalds Highlights Linux’s Importance,” Operating Systems Blog, PC World, http://bit.ly/HTceE4 (4/19/2012) Peyrache, Eloic, Jacques Cremer, & Jean Tirole, “Some Reflections on Open Source Software,” Communications & Strategies, vol. 40, pp. 139–159 (2000) Raymond, Eric, “The Cathedral and the Bazaar: Musings on Linux and Open Source by an Accidental Revolutionary, Revised Edition,” Sebastopol, CA: O’Reilly & Assoc., Inc. (2001) Terwiesch, Christian, & Yi Xu, “Innovation Contests, Open Innovation, and Multiagent Problem Solving,” Management Science, vol. 54(9), pp. 1529–1543 (2008) Torvalds, Linus, “Re: [Announce] [patch] Modular Scheduler Core and Completely Fair Scheduler [CFS],” E-mail exchange, http://bit.ly/wxQVcQ (4/15/2007) Torvalds, Linus, & David Diamond, Just for Fun: The Story of an Accidental Revolutionary, New York: Harper Business (2002) Watson, Andrew, “Reputation in Open Source Software,” Working Paper (2005) “Who Uses TopCoder?”

Coding Freedom: The Ethics and Aesthetics of Hacking by E. Gabriella Coleman

activist lawyer, Benjamin Mako Hill, commoditize, Computer Lib, crowdsourcing, Debian, disinformation, Donald Knuth, dumpster diving, Eben Moglen, en.wikipedia.org, financial independence, Free Software Foundation, Gabriella Coleman, ghettoisation, GnuPG, Hacker Conference 1984, Hacker Ethic, Hacker News, Herbert Marcuse, informal economy, information security, Jacob Appelbaum, Jaron Lanier, Jason Scott: textfiles.com, Jean Tirole, knowledge economy, laissez-faire capitalism, Larry Wall, Louis Pasteur, machine readable, means of production, Multics, Neal Stephenson, Paul Graham, peer-to-peer, pirate software, popular electronics, RFC: Request For Comment, Richard Stallman, rolodex, Ronald Reagan, Silicon Valley, Silicon Valley startup, slashdot, software patent, software studies, Steve Ballmer, Steven Levy, tacit knowledge, technological determinism, Ted Nelson, the Cathedral and the Bazaar, The Hackers Conference, the scientific method, The Soul of a New Machine, The Structural Transformation of the Public Sphere, web application, web of trust, Yochai Benkler

Leonard, Andrew. 1998. The Saint of Free Software. Salon.com. http://archive.salon.com/21st/feature/1998/08/cov_31feature.html (accessed July 17, 2011). Lerner, Josh, and Mark Schankerman. 2010. The Comingled Code: Open Source and Economic Development. Cambridge, MA: MIT Press. Lerner, Josh, and Jean Tirole. 2001. The Open Source Movement: Key Research Questions. European Economic Review 45 (4–6): 819–26. Lessig, Lawrence. 1999. Code and Other Laws of Cyberspace. New York: Basic Books. 2001a. The Future of Ideas: The Fate of the Commons in a Connected World. New York: Random House. 2001b. Jail Time in the Digital Age.

Custodians of the Internet: Platforms, Content Moderation, and the Hidden Decisions That Shape Social Media by Tarleton Gillespie

4chan, A Declaration of the Independence of Cyberspace, affirmative action, Airbnb, algorithmic bias, algorithmic management, AltaVista, Amazon Mechanical Turk, borderless world, Burning Man, complexity theory, conceptual framework, crowdsourcing, deep learning, do what you love, Donald Trump, drone strike, easy for humans, difficult for computers, Edward Snowden, eternal september, fake news, Filter Bubble, Gabriella Coleman, game design, gig economy, Google Glasses, Google Hangouts, hiring and firing, Ian Bogost, independent contractor, Internet Archive, Jean Tirole, John Gruber, Kickstarter, Mark Zuckerberg, mass immigration, Menlo Park, Minecraft, moral panic, multi-sided market, Netflix Prize, Network effects, pattern recognition, peer-to-peer, power law, real-name policy, recommendation engine, Rubik’s Cube, Salesforce, sharing economy, Silicon Valley, Skype, slashdot, Snapchat, social graph, social web, Steve Jobs, Stewart Brand, TED Talk, Telecommunications Act of 1996, two-sided market, WikiLeaks, Yochai Benkler

In Intersectional Internet: Race, Sex, Class and Culture Online, ed. Safiya Umoja Noble and Brendesha Tynes, 147–59. New York: Peter Lang. http://ir.lib.uwo.ca/commpub/12/?utm_source=ir.lib.uwo.ca%2Fcommpub%2F12&utm_medium=PDF&utm_campaign=PDFCoverPages. ———. 2017. “Content Moderation.” http://escholarship.org/uc/item/7371c1hf.pdf. ROCHET, JEAN-CHARLES, AND JEAN TIROLE. 2003. “Platform Competition in Two-Sided Markets.” Journal of the European Economic Association 1 (4): 990–1029. ROGERS, KEVIN. 2013. “Jailbroken: Examining the Policy and Legal Implications of iPhone Jailbreaking.” Pittsburgh Journal of Technology Law and Policy 13 (2). ROTH, LORNA. 2009. “Looking at Shirley, the Ultimate Norm: Colour Balance, Image Technologies, and Cognitive Equity.”

The Glass Half-Empty: Debunking the Myth of Progress in the Twenty-First Century by Rodrigo Aguilera

"Friedman doctrine" OR "shareholder theory", "World Economic Forum" Davos, activist fund / activist shareholder / activist investor, Alan Greenspan, Anthropocene, availability heuristic, barriers to entry, basic income, benefit corporation, Berlin Wall, Bernie Madoff, Bernie Sanders, bitcoin, Boris Johnson, Branko Milanovic, Bretton Woods, Brexit referendum, Capital in the Twenty-First Century by Thomas Piketty, capitalist realism, carbon footprint, Carmen Reinhart, centre right, clean water, cognitive bias, collapse of Lehman Brothers, Colonization of Mars, computer age, Corn Laws, corporate governance, corporate raider, creative destruction, cryptocurrency, cuban missile crisis, David Graeber, David Ricardo: comparative advantage, death from overwork, decarbonisation, deindustrialization, Deng Xiaoping, Doha Development Round, don't be evil, Donald Trump, Doomsday Clock, Dunning–Kruger effect, Elon Musk, European colonialism, fake news, Fall of the Berlin Wall, first-past-the-post, Francis Fukuyama: the end of history, fundamental attribution error, gig economy, Gini coefficient, Glass-Steagall Act, Great Leap Forward, green new deal, Hans Rosling, housing crisis, income inequality, income per capita, index fund, intangible asset, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Jean Tirole, Jeff Bezos, Jeremy Corbyn, Jevons paradox, job automation, job satisfaction, John Maynard Keynes: Economic Possibilities for our Grandchildren, joint-stock company, Joseph Schumpeter, karōshi / gwarosa / guolaosi, Kenneth Rogoff, Kickstarter, lake wobegon effect, land value tax, Landlord’s Game, late capitalism, liberal capitalism, long peace, loss aversion, low interest rates, Mark Zuckerberg, market fundamentalism, means of production, meta-analysis, military-industrial complex, Mont Pelerin Society, moral hazard, moral panic, neoliberal agenda, Network effects, North Sea oil, Northern Rock, offshore financial centre, opioid epidemic / opioid crisis, Overton Window, Pareto efficiency, passive investing, Peter Thiel, plutocrats, principal–agent problem, profit motive, public intellectual, purchasing power parity, race to the bottom, rent-seeking, risk tolerance, road to serfdom, Robert Shiller, Robert Solow, savings glut, Scientific racism, secular stagnation, Silicon Valley, Silicon Valley ideology, Slavoj Žižek, Social Justice Warrior, Social Responsibility of Business Is to Increase Its Profits, sovereign wealth fund, Stanislav Petrov, Steven Pinker, structural adjustment programs, surveillance capitalism, tail risk, tech bro, TED Talk, The Spirit Level, The Wealth of Nations by Adam Smith, too big to fail, trade liberalization, transatlantic slave trade, trolley problem, unbiased observer, universal basic income, Vilfredo Pareto, Washington Consensus, Winter of Discontent, Y2K, young professional, zero-sum game

One study by a trio of Harvard economists showed that in a panel of five Western countries (including the UK, France, Italy, and Sweden), Americans were the only ones to overstate the odds of a child born to parents in the poorest fifth of income joining the richest fifth as an adult.38 Another study by French economists Roland Bénabou and Jean Tirole noted that around twice as many Europeans were likely to ascribe life outcomes to “luck” rather than effort or education compared to US respondents.39 Likewise, Americans were over twice as likely to think that the poor are “lazy or lack willpower” than Europeans. The policy consequence of this is that countries which are more likely to support BJW are less likely to adopt redistributive policies, as evidenced by the correlation between high BJW and low social spending.

Machine, Platform, Crowd: Harnessing Our Digital Future by Andrew McAfee, Erik Brynjolfsson

"World Economic Forum" Davos, 3D printing, additive manufacturing, AI winter, Airbnb, airline deregulation, airport security, Albert Einstein, algorithmic bias, AlphaGo, Amazon Mechanical Turk, Amazon Web Services, Andy Rubin, AOL-Time Warner, artificial general intelligence, asset light, augmented reality, autism spectrum disorder, autonomous vehicles, backpropagation, backtesting, barriers to entry, behavioural economics, bitcoin, blockchain, blood diamond, British Empire, business cycle, business process, carbon footprint, Cass Sunstein, centralized clearinghouse, Chris Urmson, cloud computing, cognitive bias, commoditize, complexity theory, computer age, creative destruction, CRISPR, crony capitalism, crowdsourcing, cryptocurrency, Daniel Kahneman / Amos Tversky, data science, Dean Kamen, deep learning, DeepMind, Demis Hassabis, discovery of DNA, disintermediation, disruptive innovation, distributed ledger, double helix, driverless car, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, Ethereum, ethereum blockchain, everywhere but in the productivity statistics, Evgeny Morozov, fake news, family office, fiat currency, financial innovation, general purpose technology, Geoffrey Hinton, George Akerlof, global supply chain, Great Leap Forward, Gregor Mendel, Hernando de Soto, hive mind, independent contractor, information asymmetry, Internet of things, inventory management, iterative process, Jean Tirole, Jeff Bezos, Jim Simons, jimmy wales, John Markoff, joint-stock company, Joseph Schumpeter, Kickstarter, Kiva Systems, law of one price, longitudinal study, low interest rates, Lyft, Machine translation of "The spirit is willing, but the flesh is weak." to Russian and back, Marc Andreessen, Marc Benioff, Mark Zuckerberg, meta-analysis, Mitch Kapor, moral hazard, multi-sided market, Mustafa Suleyman, Myron Scholes, natural language processing, Network effects, new economy, Norbert Wiener, Oculus Rift, PageRank, pattern recognition, peer-to-peer lending, performance metric, plutocrats, precision agriculture, prediction markets, pre–internet, price stability, principal–agent problem, Project Xanadu, radical decentralization, Ray Kurzweil, Renaissance Technologies, Richard Stallman, ride hailing / ride sharing, risk tolerance, Robert Solow, Ronald Coase, Salesforce, Satoshi Nakamoto, Second Machine Age, self-driving car, sharing economy, Silicon Valley, Skype, slashdot, smart contracts, Snapchat, speech recognition, statistical model, Steve Ballmer, Steve Jobs, Steven Pinker, supply-chain management, synthetic biology, tacit knowledge, TaskRabbit, Ted Nelson, TED Talk, the Cathedral and the Bazaar, The Market for Lemons, The Nature of the Firm, the strength of weak ties, Thomas Davenport, Thomas L Friedman, too big to fail, transaction costs, transportation-network company, traveling salesman, Travis Kalanick, Two Sigma, two-sided market, Tyler Cowen, Uber and Lyft, Uber for X, uber lyft, ubercab, Vitalik Buterin, warehouse robotics, Watson beat the top human players on Jeopardy!, winner-take-all economy, yield management, zero day

Erik benefited immensely from the help of his students and research team, who not only provided solutions to many of the puzzles that emerged as we worked on this book, but more important, asked the questions that occur only to people who look at problems with fresh eyes, including especially: Sagit Bar-Gill, Andrey Fradkin, Avi Gannamaneni, Shan Huang, Meng Lui, JooHee Oh, Daniel Rock, Guillaume Saint-Jacques, George Westerman, and Erina Ytsma. A few hundred students in Erik’s MBA classes served as lively test subjects for many of the nascent ideas that made it into the book, and many more that didn’t. Professors Marshall Van Alstyne, Geoff Parker, and Jean Tirole were particularly helpful in thinking through some of the issues relating to platform economics, while Naomi Stephen provided superb administrative support. Erik drew inspiration from ShaoLan Hsueh’s encouragement as the project neared completion. He is especially grateful to his family’s support throughout this project, even as it kept him away from them too often.

The Man From the Future: The Visionary Life of John Von Neumann by Ananyo Bhattacharya

Ada Lovelace, AI winter, Alan Turing: On Computable Numbers, with an Application to the Entscheidungsproblem, Albert Einstein, Alvin Roth, Andrew Wiles, Benoit Mandelbrot, business cycle, cellular automata, Charles Babbage, Claude Shannon: information theory, clockwork universe, cloud computing, Conway's Game of Life, cuban missile crisis, Daniel Kahneman / Amos Tversky, DeepMind, deferred acceptance, double helix, Douglas Hofstadter, Dr. Strangelove, From Mathematics to the Technologies of Life and Death, Georg Cantor, Greta Thunberg, Gödel, Escher, Bach, haute cuisine, Herman Kahn, indoor plumbing, Intergovernmental Panel on Climate Change (IPCC), Isaac Newton, Jacquard loom, Jean Tirole, John Conway, John Nash: game theory, John von Neumann, Kenneth Arrow, Kickstarter, linear programming, mandelbrot fractal, meta-analysis, mutually assured destruction, Nash equilibrium, Norbert Wiener, Norman Macrae, P = NP, Paul Samuelson, quantum entanglement, RAND corporation, Ray Kurzweil, Richard Feynman, Ronald Reagan, Schrödinger's Cat, second-price auction, side project, Silicon Valley, spectrum auction, Steven Levy, Strategic Defense Initiative, technological singularity, Turing machine, Von Neumann architecture, zero-sum game

An admirer of von Neumann, ‘one of the giant intellectual figures of the twentieth century’, Kahneman and his close collaborator, Amos Tversky, studied how real people actually make decisions and devised their own ‘prospect theory’ to explain findings that ran counter to some of utility theory’s predictions.78 Jean Tirole, the 2014 Nobel winner, used game theory to analyse industries dominated by a few powerful companies – an increasingly pertinent topic in the Internet economy. While economists had well-developed theories for markets with lots of competing firms and for monopolies, the theory underpinning how oligopolies work was sketchy.

Against Intellectual Monopoly by Michele Boldrin, David K. Levine

accounting loophole / creative accounting, agricultural Revolution, barriers to entry, business cycle, classic study, cognitive bias, cotton gin, creative destruction, David Ricardo: comparative advantage, Dean Kamen, Donald Trump, double entry bookkeeping, en.wikipedia.org, endogenous growth, Ernest Rutherford, experimental economics, financial innovation, Great Leap Forward, Gregor Mendel, Helicobacter pylori, independent contractor, informal economy, interchangeable parts, invention of radio, invention of the printing press, invisible hand, James Watt: steam engine, Jean Tirole, John Harrison: Longitude, Joseph Schumpeter, Kenneth Arrow, linear programming, market bubble, market design, mutually assured destruction, Nash equilibrium, new economy, open economy, PalmPilot, peer-to-peer, pirate software, placebo effect, price discrimination, profit maximization, rent-seeking, Richard Stallman, Robert Solow, seminal paper, Silicon Valley, Skype, slashdot, software patent, the market place, total factor productivity, trade liberalization, Tragedy of the Commons, transaction costs, Y2K

P1: KNP head margin: 1/2 gutter margin: 7/8 CUUS245-07 cuus245 978 0 521 87928 6 May 21, 2008 16:55 158 Against Intellectual Monopoly Economic Arguments for Intellectual Monopoly Economists – ourselves included – think that it is important that the creators of ideas be compensated for their effort in adding to our stock of knowledge.8 Although the economics literature generally acknowledges that intellectual property leads to undesirable intellectual monopoly, it also argues that this might be a good thing – because creators of new ideas may not be adequately compensated otherwise, and this is one way to provide additional compensation. As Joseph Schumpeter, in the words of Jean Tirole, puts it, “If one wants to induce firms to undertake R&D one must accept the creation of monopolies as a necessary evil.”9 This view is as commonly held among economists today as it was in the past. In their recent textbook, Robert Barro and Xavier Sala-i-Martin argue: In order to motivate research, successful innovators have to be compensated in some manner.

Narrative Economics: How Stories Go Viral and Drive Major Economic Events by Robert J. Shiller

agricultural Revolution, Alan Greenspan, Albert Einstein, algorithmic trading, Andrei Shleifer, autism spectrum disorder, autonomous vehicles, bank run, banking crisis, basic income, behavioural economics, bitcoin, blockchain, business cycle, butterfly effect, buy and hold, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, central bank independence, collective bargaining, computerized trading, corporate raider, correlation does not imply causation, cryptocurrency, Daniel Kahneman / Amos Tversky, debt deflation, digital divide, disintermediation, Donald Trump, driverless car, Edmond Halley, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, fake news, financial engineering, Ford Model T, full employment, George Akerlof, germ theory of disease, German hyperinflation, Great Leap Forward, Gunnar Myrdal, Gödel, Escher, Bach, Hacker Ethic, implied volatility, income inequality, inflation targeting, initial coin offering, invention of radio, invention of the telegraph, Jean Tirole, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, litecoin, low interest rates, machine translation, market bubble, Modern Monetary Theory, money market fund, moral hazard, Northern Rock, nudge unit, Own Your Own Home, Paul Samuelson, Philip Mirowski, plutocrats, Ponzi scheme, public intellectual, publish or perish, random walk, Richard Thaler, Robert Shiller, Ronald Reagan, Rubik’s Cube, Satoshi Nakamoto, secular stagnation, shareholder value, Silicon Valley, speech recognition, Steve Jobs, Steven Pinker, stochastic process, stocks for the long run, superstar cities, The Rise and Fall of American Growth, The Theory of the Leisure Class by Thorstein Veblen, The Wealth of Nations by Adam Smith, theory of mind, Thorstein Veblen, traveling salesman, trickle-down economics, tulip mania, universal basic income, Watson beat the top human players on Jeopardy!, We are the 99%, yellow journalism, yield curve, Yom Kippur War

Fair, Ray C. 1987. “Sources of Output and Price Variability in a Macroeconomic Model.” Yale University: Cowles Foundation Discussion Paper 815. Fair, Ray C., and Robert J. Shiller. 1989. “The Informational Content of Ex Ante Forecasts.” Review of Economics and Statistics 71(2):325–31. Falk, Armin, and Jean Tirole. 2016. “Narratives, Imperatives, and Moral Reasoning.” Unpublished paper, University of Bonn. Falter, Jürgen W. 1986. “Unemployment and the Radicalisation of the German Electorate 1928–1933: An Aggregate Data Analysis with Special Emphasis on the Rise of National Socialism.” In Peter Stachura, ed., Unemployment and the Great Depression in Weimar Germany, 187–208.

Corporate Warriors: The Rise of the Privatized Military Industry by Peter Warren Singer

Apollo 13, barriers to entry, Berlin Wall, blood diamond, borderless world, British Empire, colonial rule, conceptual framework, disinformation, failed state, Fall of the Berlin Wall, financial independence, full employment, Global Witness, Jean Tirole, joint-stock company, Machinery of Freedom by David Friedman, market friction, military-industrial complex, moral hazard, Nelson Mandela, new economy, no-fly zone, offshore financial centre, Peace of Westphalia, principal–agent problem, prisoner's dilemma, private military company, profit maximization, profit motive, RAND corporation, risk/return, rolodex, Ronald Coase, Ronald Reagan, Scramble for Africa, South China Sea, supply-chain management, The Nature of the Firm, The Wealth of Nations by Adam Smith, vertical integration

The fact that industry employees do not have any union protection only underscores their dependence on the goodwill of firm management and the impetus to turn a profit. Shichor, Punishment for Profit. 56. 21. Donahue, Privatization Decision, 54. 22. Ash ton Carter and John White, Keeping the Edge (Cambridge: MIT Press, 2001), 187. 23. Donahue, Privatization Decision, 105. 24. Jean Tirole. The Theory of Industrial Organization (Cambridge, Mass.: MIT Press, 1988), 29-49- 25. General Accounting Office. "Contingency Operations: Army Should Do More to Control Contract Cost in the Balkans." NSDIAD-00-225. October (i, 2000. http://www .gao.gov/ 2(3. Interviews with a PMF employee and a L\S. government official, Sarajevo, July 1999. 27.

To Save Everything, Click Here: The Folly of Technological Solutionism by Evgeny Morozov

"World Economic Forum" Davos, 3D printing, algorithmic bias, algorithmic trading, Amazon Mechanical Turk, An Inconvenient Truth, Andrew Keen, augmented reality, Automated Insights, behavioural economics, Berlin Wall, big data - Walmart - Pop Tarts, Buckminster Fuller, call centre, carbon footprint, Cass Sunstein, choice architecture, citizen journalism, classic study, cloud computing, cognitive bias, creative destruction, crowdsourcing, data acquisition, Dava Sobel, digital divide, disintermediation, Donald Shoup, driverless car, East Village, en.wikipedia.org, Evgeny Morozov, Fall of the Berlin Wall, Filter Bubble, Firefox, Francis Fukuyama: the end of history, frictionless, future of journalism, game design, gamification, Gary Taubes, Google Glasses, Ian Bogost, illegal immigration, income inequality, invention of the printing press, Jane Jacobs, Jean Tirole, Jeff Bezos, jimmy wales, Julian Assange, Kevin Kelly, Kickstarter, license plate recognition, lifelogging, lolcat, lone genius, Louis Pasteur, machine readable, Mark Zuckerberg, market fundamentalism, Marshall McLuhan, moral panic, Narrative Science, Nelson Mandela, Nicholas Carr, packet switching, PageRank, Parag Khanna, Paul Graham, peer-to-peer, Peter Singer: altruism, Peter Thiel, pets.com, placebo effect, pre–internet, public intellectual, Ray Kurzweil, recommendation engine, Richard Thaler, Ronald Coase, Rosa Parks, self-driving car, Sheryl Sandberg, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, Skype, Slavoj Žižek, smart meter, social graph, social web, stakhanovite, Steve Jobs, Steven Levy, Stuxnet, surveillance capitalism, systems thinking, technoutopianism, TED Talk, the built environment, The Chicago School, The Death and Life of Great American Cities, the medium is the message, The Nature of the Firm, the scientific method, The Wisdom of Crowds, Thomas Kuhn: the structure of scientific revolutions, Thomas L Friedman, transaction costs, Twitter Arab Spring, urban decay, urban planning, urban sprawl, Vannevar Bush, warehouse robotics, WikiLeaks, work culture , Yochai Benkler

_r=0. 302 “anything can be fun”: quoted in Chorney, “Taking the Game out of Gamification,” 8. 302 “governments typically use two tools”: Thaler, “Making Good Citizenship Fun.” 302 “relating to the duties or activities”: “Civic,” Oxford Dictionaries, http://oxforddictionaries.com/definition/english/civic. 302 into two categories: for some reviews of the motivation literature in psychology and economics, see Roland Bénabou and Jean Tirole, “Intrinsic and Extrinsic Motivation,” Review of Economic Studies 70, no. 3 (July 1, 2003): 489–520, and Richard M. Ryan and Edward L. Deci, “Intrinsic and Extrinsic Motivations: Classic Definitions and New Directions,” Contemporary Educational Psychology 25, no. 1 (January 2000): 54–67. 302 Hence, some recent social experiments: discussed in Gabe Zichermann and Christopher Cunningham, Gamification by Design: Implementing Game Mechanics in Web and Mobile Apps, 1st ed.

The Economists' Hour: How the False Prophets of Free Markets Fractured Our Society by Binyamin Appelbaum

90 percent rule, airline deregulation, Alan Greenspan, Alvin Roth, Andrei Shleifer, anti-communist, battle of ideas, Benoit Mandelbrot, Big bang: deregulation of the City of London, Bretton Woods, British Empire, business cycle, capital controls, Carmen Reinhart, Cass Sunstein, Celtic Tiger, central bank independence, clean water, collective bargaining, Corn Laws, correlation does not imply causation, Credit Default Swap, currency manipulation / currency intervention, David Ricardo: comparative advantage, deindustrialization, Deng Xiaoping, desegregation, Diane Coyle, Donald Trump, Dr. Strangelove, ending welfare as we know it, financial deregulation, financial engineering, financial innovation, fixed income, flag carrier, floating exchange rates, full employment, George Akerlof, George Gilder, Gini coefficient, greed is good, Greenspan put, Growth in a Time of Debt, Ida Tarbell, income inequality, income per capita, index fund, inflation targeting, invisible hand, Isaac Newton, It's morning again in America, Jean Tirole, John Markoff, Kenneth Arrow, Kenneth Rogoff, land reform, Les Trente Glorieuses, long and variable lags, Long Term Capital Management, low cost airline, low interest rates, manufacturing employment, means of production, Menlo Park, minimum wage unemployment, Mohammed Bouazizi, money market fund, Mont Pelerin Society, Network effects, new economy, Nixon triggered the end of the Bretton Woods system, oil shock, Paul Samuelson, Philip Mirowski, Phillips curve, plutocrats, precautionary principle, price stability, profit motive, public intellectual, Ralph Nader, RAND corporation, rent control, rent-seeking, Richard Thaler, road to serfdom, Robert Bork, Robert Gordon, Robert Solow, Ronald Coase, Ronald Reagan, Sam Peltzman, Savings and loan crisis, Silicon Valley, Simon Kuznets, starchitect, Steve Bannon, Steve Jobs, supply-chain management, The Chicago School, The Great Moderation, The Myth of the Rational Market, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, transaction costs, trickle-down economics, ultimatum game, Unsafe at Any Speed, urban renewal, War on Poverty, Washington Consensus, We are all Keynesians now

The result was deregulation without competition. Three quarters of American households have, at best, a choice of two potential providers of high-speed internet service.98 In that same year, 2005, the United Kingdom tried again, adopting a new formula for leasing phone lines based on the work of the French economist Jean Tirole. The basic balancing act is to set rates high enough to reward investment by the company that owns the lines, but low enough to encourage competitors to lease the lines. Tirole’s answer proved successful, and it has been adopted by a growing number of nations. When Tirole was honored with the Nobel Prize in 2014, a member of the prize committee told reporters, “Politicians would be stupid not to take his policy advice.”99 The United States has not, and so Americans pay more for internet access.100 It is easy to forget that markets are human creations, precisely because we have created so many markets.

Economic Origins of Dictatorship and Democracy by Daron Acemoğlu, James A. Robinson

Andrei Shleifer, British Empire, business cycle, colonial rule, conceptual framework, constrained optimization, Corn Laws, declining real wages, Edward Glaeser, European colonialism, Gunnar Myrdal, income inequality, income per capita, invisible hand, Jean Tirole, John Markoff, Kenneth Rogoff, land reform, minimum wage unemployment, Nash equilibrium, Nelson Mandela, oil shock, open economy, Pareto efficiency, rent-seeking, seminal paper, strikebreaker, total factor productivity, transaction costs, Washington Consensus, William of Occam, women in the workforce

Flora, Peter (1983) State, Economy, and Society, 1815–1975; Frankfurt: Campus-Verlag. Fogel, Robert W. (1989) Without Consent or Contract: The Rise and Fall of American Slavery; New York: Norton. Fogel, Robert W., and Stanley L. Engerman (1974) Time on the Cross: The Economics of American Negro Slavery; Boston: Little, Brown. Fudenberg, Drew, and Jean Tirole (1991) Game Theory; Cambridge, MA: MIT Press. Fukuyama, Francis (1992) The End of History and the Last Man; New York: Free Press. Galor, Oded, and Omer Moav (2003) “Das Human Kapital: A Theory of the Demise of the Class Structure,” Unpublished. http://www.econ.brown.edu/fac/Oded Galor/. Galor, Oded, and Joseph Zeira (1993) “Income Distribution and Macroeconomics,” Review of Economic Studies, 40, 35–52.

Termites of the State: Why Complexity Leads to Inequality by Vito Tanzi

accounting loophole / creative accounting, Affordable Care Act / Obamacare, Alan Greenspan, Andrei Shleifer, Andrew Keen, Asian financial crisis, asset allocation, barriers to entry, basic income, behavioural economics, bitcoin, Black Swan, Bretton Woods, business cycle, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Cass Sunstein, central bank independence, centre right, clean water, crony capitalism, David Graeber, David Ricardo: comparative advantage, deindustrialization, Donald Trump, Double Irish / Dutch Sandwich, experimental economics, financial engineering, financial repression, full employment, George Akerlof, Gini coefficient, Gunnar Myrdal, high net worth, hiring and firing, illegal immigration, income inequality, indoor plumbing, information asymmetry, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Jean Tirole, John Maynard Keynes: Economic Possibilities for our Grandchildren, Kenneth Arrow, Kenneth Rogoff, knowledge economy, labor-force participation, libertarian paternalism, Long Term Capital Management, low interest rates, market fundamentalism, means of production, military-industrial complex, moral hazard, Naomi Klein, New Urbanism, obamacare, offshore financial centre, open economy, Pareto efficiency, Paul Samuelson, Phillips curve, price stability, principal–agent problem, profit maximization, pushing on a string, quantitative easing, rent control, rent-seeking, Richard Thaler, road to serfdom, Robert Shiller, Robert Solow, Ronald Coase, Ronald Reagan, Second Machine Age, secular stagnation, self-driving car, Silicon Valley, Simon Kuznets, synthetic biology, The Chicago School, The Great Moderation, The Market for Lemons, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, transfer pricing, Tyler Cowen: Great Stagnation, universal basic income, unorthodox policies, urban planning, very high income, Vilfredo Pareto, War on Poverty, Washington Consensus, women in the workforce

., 2000, Economic Policy Reform: The Second Stage (Chicago, IL: The University of Chicago Press). La Porta, Rafael, Florencio Lopez-Silanes, Andrei Shleifer, and Robert Vishny, 1998, “The Quality of Government.” Unpublished mimeo Lacey, A. R., 2001, Robert Nozick (Princeton, NJ: Princeton University Press). Laffont, Jean-Jacques and Jean Tirole, 1993, A Theory of Incentives in Procurement and Regulations (Cambridge, MA: MIT Press). Landes, David, 1983, Revolution in Time: Clocks and the Making of the Modern World (Cambridge, MA: Harvard University Press). 1998, The Wealth and Poverty of Nations: Why Some Are So Rich and Some so Poor (New York and London: W.

The Price of Time: The Real Story of Interest by Edward Chancellor

"World Economic Forum" Davos, 3D printing, activist fund / activist shareholder / activist investor, Airbnb, Alan Greenspan, asset allocation, asset-backed security, assortative mating, autonomous vehicles, balance sheet recession, bank run, banking crisis, barriers to entry, Basel III, Bear Stearns, Ben Bernanke: helicopter money, Bernie Sanders, Big Tech, bitcoin, blockchain, bond market vigilante , bonus culture, book value, Bretton Woods, BRICs, business cycle, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, carried interest, cashless society, cloud computing, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, commodity super cycle, computer age, coronavirus, corporate governance, COVID-19, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, cryptocurrency, currency peg, currency risk, David Graeber, debt deflation, deglobalization, delayed gratification, Deng Xiaoping, Detroit bankruptcy, distributed ledger, diversified portfolio, Dogecoin, Donald Trump, double entry bookkeeping, Elon Musk, equity risk premium, Ethereum, ethereum blockchain, eurozone crisis, everywhere but in the productivity statistics, Extinction Rebellion, fiat currency, financial engineering, financial innovation, financial intermediation, financial repression, fixed income, Flash crash, forward guidance, full employment, gig economy, Gini coefficient, Glass-Steagall Act, global reserve currency, global supply chain, Goodhart's law, Great Leap Forward, green new deal, Greenspan put, high net worth, high-speed rail, housing crisis, Hyman Minsky, implied volatility, income inequality, income per capita, inflation targeting, initial coin offering, intangible asset, Internet of things, inventory management, invisible hand, Japanese asset price bubble, Jean Tirole, Jeff Bezos, joint-stock company, Joseph Schumpeter, junk bonds, Kenneth Rogoff, land bank, large denomination, Les Trente Glorieuses, liquidity trap, lockdown, Long Term Capital Management, low interest rates, Lyft, manufacturing employment, margin call, Mark Spitznagel, market bubble, market clearing, market fundamentalism, Martin Wolf, mega-rich, megaproject, meme stock, Michael Milken, Minsky moment, Modern Monetary Theory, Mohammed Bouazizi, Money creation, money market fund, moral hazard, mortgage debt, negative equity, new economy, Northern Rock, offshore financial centre, operational security, Panopticon Jeremy Bentham, Paul Samuelson, payday loans, peer-to-peer lending, pensions crisis, Peter Thiel, Philip Mirowski, plutocrats, Ponzi scheme, price mechanism, price stability, quantitative easing, railway mania, reality distortion field, regulatory arbitrage, rent-seeking, reserve currency, ride hailing / ride sharing, risk free rate, risk tolerance, risk/return, road to serfdom, Robert Gordon, Robinhood: mobile stock trading app, Satoshi Nakamoto, Satyajit Das, Savings and loan crisis, savings glut, Second Machine Age, secular stagnation, self-driving car, shareholder value, Silicon Valley, Silicon Valley startup, South Sea Bubble, Stanford marshmallow experiment, Steve Jobs, stock buybacks, subprime mortgage crisis, Suez canal 1869, tech billionaire, The Great Moderation, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, Thorstein Veblen, Tim Haywood, time value of money, too big to fail, total factor productivity, trickle-down economics, tulip mania, Tyler Cowen, Uber and Lyft, Uber for X, uber lyft, Walter Mischel, WeWork, When a measure becomes a target, yield curve

They conclude: ‘There is evidence that persistent low interest rates compress net interest margins and bank profitability, and that such a negative effect on bank profitability may in turn inhibit lending.’ 16. For evidence that low rates induce risk-taking, see Tobias Adrian and Hyun Song Shin, ‘Financial Intermediaries and Monetary Economics’, Federal Reserve Bank of New York, Staff Report No. 398, May 2010; Emmanuel Farhi and Jean Tirole, ‘Leverage and the Central Bankers’ Put’, American Economic Review, 99 (2), 1 May 2009; Leonardo Gambacorta, ‘Monetary Policy and the Risk-taking Channel’, BIS Quarterly Review, December 2009. 17. Jack Ewing, ‘Central Bankers, Worried about Bubbles, Rebuke Markets’, New York Times, 29 June 2014. 18.

The Irrational Bundle by Dan Ariely

accounting loophole / creative accounting, air freight, Albert Einstein, Alvin Roth, An Inconvenient Truth, assortative mating, banking crisis, Bear Stearns, behavioural economics, Bernie Madoff, Black Swan, Broken windows theory, Burning Man, business process, cashless society, Cass Sunstein, clean water, cognitive dissonance, cognitive load, compensation consultant, computer vision, Cornelius Vanderbilt, corporate governance, credit crunch, Credit Default Swap, Daniel Kahneman / Amos Tversky, delayed gratification, Demis Hassabis, Donald Trump, end world poverty, endowment effect, Exxon Valdez, fake it until you make it, financial engineering, first-price auction, Ford Model T, Frederick Winslow Taylor, fudge factor, Garrett Hardin, George Akerlof, Gordon Gekko, greed is good, happiness index / gross national happiness, hedonic treadmill, IKEA effect, Jean Tirole, job satisfaction, John Perry Barlow, Kenneth Arrow, knowledge economy, knowledge worker, lake wobegon effect, late fees, loss aversion, Murray Gell-Mann, name-letter effect, new economy, operational security, Pepsi Challenge, Peter Singer: altruism, placebo effect, price anchoring, Richard Feynman, Richard Thaler, Saturday Night Live, Schrödinger's Cat, search costs, second-price auction, Shai Danziger, shareholder value, Silicon Valley, Skinner box, Skype, social contagion, software as a service, Steve Jobs, subprime mortgage crisis, sunk-cost fallacy, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Tragedy of the Commons, ultimatum game, Upton Sinclair, Walter Mischel, young professional

Additional readings Eduardo Andrade and Teck-Hua Ho, “Gaming Emotions in Social Interactions,” Journal of Consumer Research 36, no. 4 (2009): 539–552. Dan Ariely, Anat Bracha, and Stephan Meier, “Doing Good or Doing Well? Image Motivation and Monetary Incentives in Behaving Prosocially,” American Economic Review 99, no. 1 (2009): 544–545. Roland Bénabou and Jean Tirole, “Incentives and Prosocial Behavior,” American Economic Review 96, no. 5 (2006): 1652–1678. Ronit Bodner and Dražen Prelec, “Self-Signaling and Diagnostic Utility in Everyday Decision Making,” in Psychology of Economic Decisions, vol. 1, ed. Isabelle Brocas and Juan Carrillo (New York: Oxford University Press, 2003).

The Age of Surveillance Capitalism by Shoshana Zuboff

"World Economic Forum" Davos, algorithmic bias, Amazon Web Services, Andrew Keen, augmented reality, autonomous vehicles, barriers to entry, Bartolomé de las Casas, behavioural economics, Berlin Wall, Big Tech, bitcoin, blockchain, blue-collar work, book scanning, Broken windows theory, California gold rush, call centre, Cambridge Analytica, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, choice architecture, citizen journalism, Citizen Lab, classic study, cloud computing, collective bargaining, Computer Numeric Control, computer vision, connected car, context collapse, corporate governance, corporate personhood, creative destruction, cryptocurrency, data science, deep learning, digital capitalism, disinformation, dogs of the Dow, don't be evil, Donald Trump, Dr. Strangelove, driverless car, Easter island, Edward Snowden, en.wikipedia.org, Erik Brynjolfsson, Evgeny Morozov, facts on the ground, fake news, Ford Model T, Ford paid five dollars a day, future of work, game design, gamification, Google Earth, Google Glasses, Google X / Alphabet X, Herman Kahn, hive mind, Ian Bogost, impulse control, income inequality, information security, Internet of things, invention of the printing press, invisible hand, Jean Tirole, job automation, Johann Wolfgang von Goethe, John Markoff, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, Kevin Kelly, Kevin Roose, knowledge economy, Lewis Mumford, linked data, longitudinal study, low skilled workers, Mark Zuckerberg, market bubble, means of production, multi-sided market, Naomi Klein, natural language processing, Network effects, new economy, Occupy movement, off grid, off-the-grid, PageRank, Panopticon Jeremy Bentham, pattern recognition, Paul Buchheit, performance metric, Philip Mirowski, precision agriculture, price mechanism, profit maximization, profit motive, public intellectual, recommendation engine, refrigerator car, RFID, Richard Thaler, ride hailing / ride sharing, Robert Bork, Robert Mercer, Salesforce, Second Machine Age, self-driving car, sentiment analysis, shareholder value, Sheryl Sandberg, Shoshana Zuboff, Sidewalk Labs, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, slashdot, smart cities, Snapchat, social contagion, social distancing, social graph, social web, software as a service, speech recognition, statistical model, Steve Bannon, Steve Jobs, Steven Levy, structural adjustment programs, surveillance capitalism, technological determinism, TED Talk, The Future of Employment, The Wealth of Nations by Adam Smith, Tim Cook: Apple, two-sided market, union organizing, vertical integration, Watson beat the top human players on Jeopardy!, winner-take-all economy, Wolfgang Streeck, work culture , Yochai Benkler, you are the product

Roben Farzad, “Google at $400 Billion: A New No. 2 in Market Cap,” BusinessWeek, February 12, 2014, http://www.businessweek.com/articles/2014-02-12/google-at-400-billion-a-new-no-dot-2-in-market-cap. 92. “Largest Companies by Market Cap Today,” Dogs of the Dow, 2017, https://web.archive.org/web/20180701094340/http://dogsofthedow.com/largest-companies-by-market-cap.htm. 93. Jean-Charles Rochet and Jean Tirole, “Two-Sided Markets: A Progress Report,” RAND Journal of Economics 37, no. 3 (2006): 645–67. 94. For a discussion on this point and its relation to online target advertising, see Katherine J. Strandburg, “Free Fall: The Online Market’s Consumer Preference Disconnect” (working paper, New York University Law and Economics, October 1, 2013). 95.