Alvin Roth, Nobel Prize winner and Stanford University economics professor, spoke to San Jose State students about the economics of controversial topics in today’s society at the Dr. Martin Luther King, Jr. Library, on Wednesday.
Roth was the co-winner of the Nobel Prize in Economics for his work in market design and his work in matching theory, according to an article by the University of Pittsburgh.
Markets are merging processes that factor in supply and demand, according to an October 2007 article written by Roth in the Harvard Business Review.
According to the same article, market design focuses on the “detailed rules” within well-functioning markets.
Roth was also one of the experts who helped revolutionize kidney donations around the world by using an economic theory to make kidneys more available, according to a Dec. 17, 2019 BBC article.
“He is certainly an expert,” said Philip Held, a consulting professor at Stanford University. “There’s a lot of underestimation of the fantastic contribution [he made] with . . . organ exchange.”
Held said Roth doesn't give himself enough credit for putting today’s modern approach to kidney donations on the map.
During the lecture, Roth said his interests also include other repugnant or controversial markets.
He said markets connected to controversial issues include repugnant transactions.
He said repugnant transactions are, “transactions that some people would like to engage in but some people don’t think they should be allowed to [. . .].”
He said he wanted to focus on situations where people state someone else should not be able to participate in certain transactions for moral reasons, regardless of whether or not it affects them personally.
“I think [. . .] a big question that economists have to come to terms with, that we haven’t yet, [. . .] is, ‘Why does some markets get social support?’ ” Roth said.
Roth said economists should focus on why markets with less social support are pressured to be banned and to take into account if these markets should be banned too.
He said one example of this is the debate between whether or not people in society should treat drug addicts as criminals or as victims.
Roth said one side of the debate is to end the drug crisis by aggressively prosecuting drug addicts as criminals.
“On the other hand, there’s this harm reduction movement that says, ‘You know, we hate drugs and drug addicts . . . but we don’t want them to die overdose deaths,’ ” Roth said.
He said this side of the argument prefers to focus on harm reduction measures such as opening supervised drug injections sites.
Roth said this creates tension between these two sides of the debate because despite the other side’s intentions, supervised drug injection sites are illegal in the U.S.
He also explained that people living near these injection sites would not be concerned that drug addicts may travel into their community.
Roth said these concerns don’t change the fact that countries that treat drug addicts more like patients have fewer overdose deaths.
“So of course, just as we don’t want any contract killing, we don’t want any drug addicts,” Roth said.
He also said it’s harder to understand what to do for drug addicts in comparison to what to do for contract killing.
“And so perhaps, you know, as market designers, we should be thinking [. . .] about what else we can do [. . .] but it’s very controversial,” he said.
Roth said there are also other examples of repugnant transactions, including other examples that differ in political support for certain controversial topics.
“Sex is a good place to look for repugnant [transactions] because people want to have sex with each other and we don’t want them to,” Roth said.
He said same-sex marriage is a good example of a repugnant transaction.
Roth said for decades, California banned and legalized same-sex relations multiple times because of changing circumstances.
Roth said for example, same-sex marriage was not always banned in California because there were already pre-existing laws banning same-sex sexual relations.
“Not long after in 1977, California passed a ban on same-sex marriages,” Roth said. “Before, they hadn’t had that because the people who worried about same-sex marriage felt protected by the ban on same-sex sex.”
He said after the ban was taken away, the state quickly moved to ban same-sex marriages in California.
Roth said this back and forth between banning and legalizing same sex marriage continued in California until the U.S. Supreme Court legalized same sex marriage for all 50 states in 2015.
He said economists should be thinking about how to navigate these controversial and morally contested issues or “markets.”
“This is a problem that’s important for economists,” Roth said. “It’s too important to be left just to the philosophers and politicians.”
Roth said he’s been studying controversial markets because he thinks economists should know more about why some markets get support and others don’t.
He also said it’s an exciting time to be an economist.
“Right now in Silicon Valley, we’re seeing the growth of lots of markets,” Roth said. “We’re seeing lots of markets be invented and designed and evolved and regulated, and economics is about that.”
