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Leonid
Hurwicz
90-year-old
USA
University of Minnesota
Minneapolis, MN, USA
|
Eric
S. Maskin
57-year-old
USA
Institute for Advanced Study
Princeton, NJ, USA |
Roger
B. Myerson
56-year-old
USA
University of Chicago
Chicago, IL, USA |
"for having laid the foundations of mechanism design theory"
The
design of economic institutions
Adam Smith's classical metaphor of the invisible hand refers to how
the market, under ideal conditions, ensures an efficient allocation
of scarce resources. But in practice conditions are usually not ideal;
for example, competition is not completely free, consumers are not
perfectly informed and privately desirable production and consumption
may generate social costs and benefits. Furthermore, many transactions
do not take place in open markets but within firms, in bargaining
between individuals or interest groups and under a host of other institutional
arrangements. How well do different such institutions, or allocation
mechanisms, perform? What is the optimal mechanism to reach a certain
goal, such as social welfare or private profit? Is government regulation
called for, and if so, how is it best designed?
These questions
are difficult, particularly since information about individual preferences
and available production technologies is usually dispersed among many
actors who may use their private information to further their own
interests. Mechanism design theory, initiated by Leonid Hurwicz and
further developed by Eric Maskin and Roger Myerson, has greatly enhanced
our understanding of the properties of optimal allocation mechanisms
in such situations, accounting for individuals' incentives and private
information. The theory allows us to distinguish situations in which
markets work well from those in which they do not. It has helped economists
identify efficient trading mechanisms, regulation schemes and voting
procedures. Today, mechanism design theory plays a central role in
many areas of economics and parts of political science.
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Mr CHAN Shu-hon (Head of Department)
S. 6 and 7
An introduction
of S. 4 and 5 Economics to S. 3 students and their parents (a PowerPoint file)
Adam Smith (1723 - 1790)
John Maynard Keynes (1883 - 1946)
Ronald H. Coase (1910 - )
Milton Friedman (1912 - 2006)
Alan Greenspan (1926 - )
The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel
Hong Kong SAR Government Information Centre
Hong Kong Monetary Authority
The 2006-07 Budget
Census and Statistics Department, HKSAR Government
Inland Revenue Department, HKSAR Government
School of Economics and Finance, HKU
Department of Economics, CUHK
Department of Economics, HKUST
Department of Economics, BU 
School of Accounting and Finance, PolyU
Department of Economics and Finance, CityU
Department of Economics, LU
Hong Kong Statistical Society 
Hong Kong Examinations and Assessment Authority
Hong Kong Education City
Economists.com.hk (a discussion forum)
Econman (a personal website)