**Content source | Excerpted from a CITIC Publishing Group book**
*Who Gets What — and Why*
By Alvin E. Roth
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## Introduction
Every year during China’s college entrance exam (**Gaokao**) season, countless families face the stressful challenge of submitting applications. Although the past two decades have seen a shift from **“sequential choices”** to **“parallel choices”** for admissions, issues like unwanted program reassignment or failing to secure a preferred major still persist.
**Why does this happen?**
In the Gaokao application market, **price mechanisms do not work** — the best universities aren’t necessarily the most costly, and admitted students aren’t always the highest scorers.
Across education, healthcare, and economics, many markets function through **non-price “matching” mechanisms** — each susceptible to its own kind of failure.
### Examples of Matching Problems
- Admission to elite graduate programs — *Who gets in?*
- Passenger travel during Lunar New Year — *Who gets a ticket home?*
- Jobs in high-demand industries — *Who gets hired?*
- Kidney transplant allocation — *Who gets a suitable organ?*
Alvin E. Roth, Nobel Prize laureate in Economics (2012), devoted his career to studying these **“unseen rules”** of matching. His core question: **Who gets what, and why?**
Only by understanding why markets mismatch can we effectively redesign them.
*Who Gets What — and Why* introduces market failures in American society, revealing how improved design can restore order amid chaos and congestion.
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## 1. Preventing Runaway Markets
### **Why Do Financial Markets Settle Every Second?**
Speed in a market can boost prosperity — or trigger collapse. In **thick** markets, speed enables quick evaluation of trades; but ultra-fast speed can reduce efficiency.
#### Case Study — S&P 500 Trading
- **NYSE** → SPY (S&P 500 ETF)
- **CME** → ES (S&P 500 E-mini Futures)
Both are thick, liquid markets, with millions of trades daily. At human scale, hundreds of opportunities occur every second.
But **at millisecond scale**, markets may appear thin to computers — price changes take milliseconds to travel between Chicago and New York. This delay enables **arbitrage opportunities**.
#### The Race for Milliseconds
- Pre-2010: Fiber-optic cables took 16 ms round-trip between Chicago & New York.
- 2010: A straighter route cut time to 13 ms — a massive advantage.
In **first-come, first-served** systems, being first secures profits.
*Scene from The Big Short*
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### Flash Crash 2010
Ultra-fast ES and SPY trading triggered a sudden crash & rebound in minutes.
High-frequency algorithms acted faster than human oversight, causing extreme volatility. By the time humans responded, chaos reigned.
#### Market Design Reform
Economists Eric Budish, Peter Cramton, and John Shim proposed:
- Replace continuous trading with **batch auctions every second**.
- Gather all bids/asks within each second, then match at the most competitive price.
Benefits:
- Removes incentive to chase milliseconds.
- Easy for standard computers to process.
- Maintains efficiency despite minor delays.
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## 2. Thick but Congested
### **When School Choice Becomes a Traffic Jam**
Markets function best at the **right pace** — neither too fast nor too slow.
#### NYC High School Admissions (90,000 Students)
**Old System:**
- Students → list 5 preferred schools in order.
- DOE forwards applications to each school.
- Schools respond: lottery or independent decision.
- Students may hold one offer + one waitlist spot.
- Three rounds of offers → rejections → reassignment.
*Cumbersome paper-based workflow → chaos.*
Problems:
- Many left without offers until August.
- Informal channels bypassed the system.
- The process could not handle full capacity.
**Congestion timeline:**
- Round 1: ~50,000 received offers; 17,000 had multiple offers → decision delays.
- Round 3: ~30,000 still unmatched → central assignment.
- Some parents leveraged **gray market** access via principals.
Opaque practices eroded trust; connections often prevailed over merit.
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## 3. When Prices Fail
### **Who Gets a Life-Saving Kidney?**
Kidney transplants save lives, yet **buying/selling kidneys is illegal** worldwide.
With extreme scarcity, markets must rely on **matching** instead of price.
#### Paired Kidney Exchange
- A donor incompatible with their intended patient may match with another patient.
- By forming chains or cycles, more lives are saved.
**Why this works:**
1. **Thickness:** National matching pools increase success rates.
2. **Avoids Congestion:** Centralized algorithms find optimal matches quickly.
3. **Safety:** All surgeries happen simultaneously to ensure compliance.
4. **Prevents Premature Unraveling:** Participants wait for optimal matches.
This model now saves **tens of thousands** of lives globally.
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## Conclusion
Kidney exchanges show that even in markets where **price fails**, good design can rescue efficiency and fairness. The health of society depends not just on supply and demand, but on how invisible **matching mechanisms** are structured.
Alvin Roth’s **matching economics** teaches:
- **Markets are designed, not natural.**
- Matching reveals resource allocation logic.
- Fairness and efficiency require intentional architecture.
Similar principles now guide digital content creation. Platforms like [AiToEarn官网](https://aitoearn.ai/) use:
- AI-powered content generation
- Cross-platform publishing
- Analytics & model ranking ([AI模型排名](https://rank.aitoearn.ai))
By creating thick markets for ideas and audiences, such systems mirror the fairness and efficiency achieved in kidney exchange — proving that smart market design matters everywhere.
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