Communication Costs in Economic Mechanisms and Organizations

经济体系的一个关键功能是获取和传播消费者和企业作出符合社会需要的消费和生产选择所需的信息。这一功能通常由市场价格来执行，市场价格向个人传达相关信息，并激励他们以社会有效的方式行事。 然而，自由市场可能会因规模经济、外部性或无法为大量潜在商品定价而失败。在这种情况下，市场的“看不见的手”往往被公司经理的“看得见的手”或拍卖人的“看得见的锤子”所取代。 本项目将审查这种替代性经济体制的设计。一种假设的经济机制会要求所有参与者透露他们的偏好和技术，然后实现一个有效的结果（可以通过适当设计的货币补偿来激励诚实的沟通）。 问题是，这种机制需要大量的通信。 本研究将利用经济学和计算机科学中发展起来的通信成本模型，研究如何设计能够节省通信成本的经济机制。其中一个重要的应用是设计组合拍卖，在投标人之间分配不同的对象（最近的例子包括频谱许可证拍卖和在线采购）。 由于每个出价人对物品的每个子集都有估价，并且这样的子集的数量在对象的数量中是指数的，所以偏好的完全传达将需要禁止性的传达（例如，如果有30个物体，它将涉及宣布超过10亿个数字）。 这项研究（与计算机科学家Noam Nisan合作）将确定实现社会有效或近似有效分配的通信负担。特别是，它将研究需要多少沟通，以改善出售所有对象作为一个捆绑的出价最高的人，以及答案如何取决于设计师的先验知识的结构投标人的喜好。另一个应用是公司的组织。正如罗纳德·科斯（Ronald Coase）在1937年指出的那样，当“发现相关价格”的成本过高时，企业就会出现。 这个想法可以在一个复杂的协调问题中检验，在这个问题中，集中所有代理人的信息以获得理想的决策实际上是不可能的，但是协调可以通过其中一个代理人的“权威”来实现。 这个模型可以解释为什么信息处理和决策的“管理任务”集中在少数人手中，而不是平均分配给组织成员。它还可以识别最佳管理层级的属性，例如其高度，控制范围和员工/操作员比例。这也可以解释为什么高技能的人往往被安排在更高的职位，阐明了组织结构在决定不同技能工人之间的可替代性，从而决定市场技能溢价方面的作用。最后，它可以用来理解信息技术的组织效应，它可以减少沟通成本，改变组织结构和影响技能溢价。

A key function of an economic system is to acquire and disseminate the information necessary for consumers and firms to make socially desirable consumption and production choices. This function is often performed by market prices, which convey to individuals the relevant information, and motivating them to act in a socially efficient way. However, free markets may fail due to economies of scale, externalities, or the inability to price a large number of potential goods. In such situations, the "invisible hand" of the market is often substituted with the "visible hand" of managers in firms or with the "visible hammers" of auctioneers. This project will examine the design of such alternative economic institutions. One hypothetical economic mechanism would ask all participants to reveal their preferences and technology, and then implement an efficient outcome (the incentives to communicate truthfully can be provided with appropriately designed monetary compensation). The problem is that this mechanism would require a prohibitive amount of communication. The study will examine the design of economic mechanisms that economize on communication costs, using the models of communication costs developed in economics and computer science.One important application is the design of combinatorial auctions, which allocate heterogeneous objects among bidders (recent examples include auctions of spectrum licenses and online procurement). Since every bidder has a valuation for each subset of the items, and the number of such subsets is exponential in the number of objects, full communication of preferences would require prohibitive communication (e.g., with 30 objects, it would involve the announcement of more than one billion numbers). The study (joint with Noam Nisan, a computer scientist) will identify the communication burden of realizing socially efficient or approximately efficient allocations. In particular, it will examine how much communication is required to improve upon selling all objects as a bundle to the highest bidder, and how the answer depends on the designer's a priori knowledge of the structure of bidders' preferences. Another application is to the organization of firms. As noted by Ronald Coase in 1937, firms arise when the cost of "discovering what the relevant prices are" would be prohibitive. This idea can be examined in a complex coordination problem, in which pooling all agents' information to obtain an ideal decision may be practically impossible, but coordination may be achieved by "authority" of one of the agents. This model could explain why the "managerial task" of information processing and decision-making is concentrated in the hands of few, rather than being spread evenly among organization members. It can also identify the properties of the optimal management hierarchy, such as its height, spans of control, and the staff/operators ratio. It may also explain why higher-skilled individuals are often placed in higher positions, illuminating the role of organizational structure in determining the substitutability between workers of different skills, and consequently the market skill premium. Finally, it can be used to understand the organizational effects of information technology, which can reduce communication costs, changing the organizational structure and affecting the skill premium.