Algorithms, Data, and Market Design
In fall 2022, Yale launched a new program to support new undergraduate course offerings and interdisciplinary research at the intersection of Computer Science, Data Science and Economics.
Digital platforms like Amazon, Alphabet (Google), and Meta (Facebook) are among the largest corporations in the world, and this sector is constantly evolving, creating both opportunities and challenges. Yale is responding with new mechanisms for advancing the understanding of the digital economy and identifying effective policy responses.
This fall, Yale University is launching a new program on Algorithms, Data and Market Design which will support new undergraduate course offerings and interdisciplinary research at the intersection of Computer Science, Data Science and Economics. The initiative will be supported by the Cowles Foundation for Research in Economics and led by Douglass and Marion Campbell Professor of Economics Dirk Bergemann.
I think of programming, coding, and data analysis as essentially a new language requirement that an excellent liberal arts education should include for all undergraduates.
— Professor Dirk Bergemann
The new initiative will support researchers working at the intersection of economics and computer science, in areas such as game theory, algorithmic design and causal inference. Funding will be available for workshops and seminars, and to support postdocs and long-term visiting faculty.
Building on the success of the popular joint major in economics and computer science, which Yale started offering in 2020, the initiative will support three new economics courses this fall:
- Economics of Artificial Intelligence and Innovation (Econ 472)
- Economics of Blockchains (Econ 451a/Econ 451b)
- Economics and Computation (Econ 425)
This initiative builds on momentum from the Tobin Center for Economic Policy, which also recently launched a Digital Economy Project under the leadership of Fiona Scott-Morton, Katja Seim and dirk Bergemann. The project aims to improve the theoretical understanding and empirical knowledge of digital markets, which is surprisingly limited, despite the exponential growth and ubiquity of these markets. The project will prepare and expand the community of economists who study these issues, so they can advise policymakers across the globe on how to craft effective policy responses.
The Digital Economy Project includes a consortium of the world’s leading theoretical and regulatory economists, coordinated by the Yale Professors. Participating consortium members hail from such universities as Columbia, Harvard, MIT, Munich, Stanford, and Toulouse. The Sloan Foundation, Omidyar Network, and the Knight Foundation have generously contributed support for this project at the Tobin Center.
Both initiatives are built upon the foundation of rigorous digital economy research that economics faculty have been working on at the department for years. In May, Bergemann, along with Yale graduate student Tan Gan and MIT’s Alessandro Bonatti, published a lead article in the RAND Journal of Economics, entitled “The economics of social data,” which provides a new economic framework for how think about data and information externalities. The paper explains that consumers will place a very low value on withholding their personal data because digital platforms can still predict their preferences by using information from other consumers with similar characteristics or behaviors. This is a classic externality problem, which the authors suggest calls for a policy solution that goes beyond granting individual consumers rights over their data.
Complementing these Economics Department initiatives are two projects at Yale professional schools. The Thurman Arnold Project at the School of Management brings together faculty, students, and scholars to collaborate on research related to competition policy and antitrust enforcement. In May, students affiliated with this project traveled to Washington D.C. to present new ideas on digital platform regulation to policymakers from Capitol Hill, the Justice Department, the Federal Communications Commission, and the Federal Trade Commission. At the Law School, the Information Society Project, led by Professor Jack Balkin, is supporting a community of scholars who explore issues at the intersection of law, technology, and society.