Networks II: Market Design

Information Science 4220/Computer Science 4852/Economics 3825
Cornell University, Spring 2018

Tues-Thu 2:55pm-4:10pm

Location: TBA

Arpita Ghosh

Networks II: Market Design builds on its prerequisite course, continuing to examine how computing, economic and sociological worlds are connected, and how abstract mathematical models and analysis can inform their design. In this course, we will construct mathematical models for and analyze networked settings, allowing us to both make predictions about behavior in such systems, as well as reason about how to design such systems to exhibit some desirable behavior. Throughout, we will draw on real-world applications such as kidney exchange, college admissions and reputations systems in online marketplaces that illustrate these phenomena.

Answers to FAQs this time of the year:

Note: I am typically unable to respond to individual email due to a chronic medical condition. Once classes start, asking questions in-person, either in or after class or in office hours will be the best way to communicate with me. Until then, this webpage will contain all currently available information about the course.

For questions regarding prerequisites, please see the FAQs under Prerequisites below.
Enrollment:
- Update: We have cleared all students on the waitlist as of January 23, and the enrollment status is now switched from waitlist to add-drop. Specifically, there is no longer a waitlist being managed for this class. If you still want to add the class, you need to keep checking StudentCenter to see if seats have opened up, and add yourself if and when any openings become available.
  - There is typically a fair amount of flux soon after class begins, and that leads to seats opening up (sadly, I am unable to predict the extent to which this will happen this year (or any year!)).
  - For any questions or issues regarding enrollment not answered in this FAQ, please email Janeen Orr (jmo10@cornell.edu).
Finally, Networks II will not be offered for technical writing any more; no special exceptions!

Note 2 : This FAQ may be updated to reflect any new frequently asked questions (to which I have answers), so please check back if you ask me a question not addressed here. (And if there isn't an update, it probably means I don't have an answer yet!)

Course Information

Instructor: Arpita Ghosh, 206 Gates Hall
Note (again): I am typically unable to respond to email due to a chronic medical condition. Asking questions in-class, after class, or in office hours (after the course starts) is the best way to communicate with me.

Office hours:

Ofice hours start the week of February 5. There will be no office hours during February break and Spring break.

Instructor office hours: My office hour is split into two half-hours:
- Monday 1:25-1:55pm, 206 Gates Hall
- Tuesday 10:30-11:00am, 206 Gates Hall
Note: My office hours may need to be modified at times during the semester. All changes to my office hours will be reflected here, so please check this page before coming in!
TA office hours:

Monday 4-5:30pm: Gates G019 (James)
Tuesday 4:30-6pm: Gates G019 (Julian)
Wednesday 3:30-5:30pm: Gates G019 (Julian)
Wednesday 5:30-7pm: Gates G019 (James)
Thursday 1:30-2:30pm: Gates G019 (Julian)
Thursday 5:30-7pm: Gates G017 (James)

Prerequisites

Networks (INFO2040)
Familiarity with logical reasoning (at the level of CS 2800 or equivalent), and basic probability and statistics.
FAQ
- I haven't taken Networks. Can I still take Networks II?
  If you have adequate background in game theory (and have the second prerequisite), you should be able to handle Networks II with the following preparatory self-study: Chapters 6, 10, 22 in Networks, Crowds and Markets. That being said, you will definitely benefit more from this class if you take it after taking Networks, so you should do that if at all possible.
- I don't have the second prerequisite. Can I still take this class?
  You can legally take this class, of course, but you might not enjoy it: some familiarity with (or at least aptitude for) simple logical reasoning and basic probability, although not associated with any particular class, is essential for Networks II.

Outline of Topics

Matching markets

Why matching markets without money?
- Kidney exchange, college admissions, school choice
- Matching markets with versus without money
One-sided matching markets without money
- Binary preferences
  - Perfect matching; Hall's theorem
- Rank-order preferences
- Application: Kidney exchange

Markets with two-sided preferences
- The marriage model; stable matchings
- The Gale-Shapley algorithm and its properties
- Many-to-one matching
- Incentives and preference reporting
- Application: College admissions (NRMP hospital-intern match)

Information and networked behavior

Information asymmetry and inefficiency in markets
- Adverse selection: Inefficiency; credible disclosure, signaling
- Moral hazard: A prisoner's dilemma model; repeated games
- Alleviating information asymmetry: Reputations

Quality uncertainty on the Web
- Online ratings and reputation systems
- Application: An empirical study and redesign of the eBay reputation system

Coursework

Readings

There is no textbook for this class, as there is no single book containing all the topics we will cover in this class. However, readings for each topic will be posted on CMS as they become relevant through the semester.

Note that these readings will not substitute for attending class, though, since the material in the lectures will typically at a different level of detail than the readings: the readings should be used as a supplement to, rather than a substitute for, the lectures.

To supplement reading material, the lecture slides will also be made available on CMS from after each lecture. Note, however, that some examples will be worked on the whiteboard in class and these will not make their way into the lecture slides. This means that again, the posted lecture slides are not a substitute for attending class.

Attending lectures:

Whether you choose to attend lectures or not is entirely up to you, given the information you have about the course structure. However, please understand that (a) you are responsible for all material that is covered, discussed, or announced in class regardless of whether you choose to come to class or not, (b) office hours and Piazza are not a substitute for skipped lectures, and (c) all this being said, please come to class only if you are sure you can stay focused enough so that your in-class behavior does not detract from the learning experience of your classmates. Students doing otherwise will be asked, politely but firmly, to leave the class.

Credit Components:

Your final grade will be based on homeworks, a midterm exam, graded clicker questions, and a blog post and course project. The weights on each of these components will be detailed closer to the start of term.

Academic Integrity

You are expected to maintain the utmost level of academic integrity in the course. Any violation of the code of academic integrity will be penalized severely.

You are allowed to collaborate on the homework to the extent of formulating ideas as a group. However:

You must write up the solutions to each problem set completely on your own, using no memory aids whatsoever from your discussions, and understand what you are writing.
You must also list the names of everyone that you discussed the problem set with.

Collaboration is not allowed on the other parts of the coursework.

Finally, plagiarism deserves special mention here. Including text from other sources in written assignments without quoting it and providing a proper citation constitutes plagiarism, and it is a serious form of academic misconduct. This includes cases in which no full sentence has been copied from the original source, but large amounts of text have been closely paraphrased without proper attribution. To get a better sense for what is allowed, it is highly recommended that you consult the guidelines maintained by Cornell on this topic. It is also worth noting that search engines have made plagiarism much easier to detect. This is a very serious issue; instances of plagiarism will very likely result in failing the course.