IPD AI Insights

7th Annual Kenneth J. Arrow Lecture: Prices and Decentralization without Convexity

Prices can often guide decentralized resource allocation effectively even in environments with non-convexities or where exact computations of optimal allocations are intractably hard.

Delivered by: Paul Milgrom, Shirley R. and Leonard W. Ely, Jr. Professor of Humanities and Sciences, Stanford University

Discussants: Kenneth J. Arrow, Joan Kenney Professor of Economics and Professor of Operations Research, Emeritus, Stanford University

Jay Sethuraman, Professor of Industrial Engineering and Operations Research, Columbia University

Joseph E. Stiglitz, University Professor, Columbia University

Prices can often guide decentralized resource allocation effectively even in environments with non-convexities or where exact computations of optimal allocations are intractably hard. The new approaches, involving collaboration between economists and computer scientists, are not just about approximate optimization, but also about creating price signals to guide investments in resources for the future.

Sponsored by the Center on Global Economic Governance, the Program for Economic Research, the Committee on Global Thought, Columbia University Press, and the Initiative for Policy Dialogue.

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