Category 28
Strategic Economics: Games, Information, and Market Design
The other side of the table is thinking too.
- 6 modules
- 36 lessons
- ~9h total
What this category covers
Most of the library assumes the world holds still while you decide. This category drops that assumption: the other side is thinking too, it knows things you do not, and the price you end up paying is the residue of that fight. It runs in sequence — the two-player logic of commitment and deterrence, then the contracts you write when you cannot see what the other party is doing, then the rules a marketplace has to enforce so it cannot be gamed, and finally the order book itself, where a price stops being a number on a page and becomes something people manufacture out of disagreement. It is the theory under auctions, platform take rates, and antitrust cases, taught from the seat of the person who has to set the rule rather than the one grading the proof. If you have ever wondered why the second-price auction is the honest one, why every marketplace subsidizes one side, or who pays for the spread, the answers are here.
Strategic Interaction
Information Economics
Mechanism and Auction Design
- Mechanism Design and the Revelation Principle
- Auction Formats and the Revenue Equivalence Theorem
- The Winner's Curse in a Common-value Auction
- The Vickrey-Clarke-Groves Mechanism and Why Nobody Runs It
- Strategy-proofness and Marketplace Rules People Cannot Game
- Matching Markets and the Deferred-acceptance Algorithm
Designing a Marketplace
- Cross-side Network Effects and Which Side to Subsidize
- The Chicken-and-egg Problem and Cold-start Strategies
- Marketplace Liquidity and the Thickness Problem
- Take-rate Design and Where a Platform Can Safely Tax
- Reputation Systems and the Economics of Trust
- Platform Governance and the Rules a Market Has to Enforce
Market Structure and Power
How a Price Is Actually Made
- The Limit Order Book and Where a Price Comes From
- The Bid-ask Spread as the Price of Adverse Selection
- Liquidity Provision and a Market Maker's Inventory Risk
- Price Discovery and How Information Gets Into a Price
- Market Impact and the Cost of Trading Size
- Dark Pools, Internalization, and Where Order Flow Goes