2007 Nobel in Economics: Designing Better Markets
Written by Mario Ritter
October 19th, 2007
This is the VOA Special English Economics Report.
Many things perform effectively but not efficiently. To be efficient means to produce a desired effect with as little waste as possible.
How can markets be designed to make them more efficient? This is a question that the three winners of this year's Nobel Prize in economics have tried to answer. They established mechanism design theory.
It began with work by Leonid Hurwicz of the University of Minnesota in nineteen sixty. Eric Maskin of the Institute for Advanced Study in Princeton, New Jersey, and Roger Myerson of the University of Chicago further developed it.
The three Americans will share the award worth about one and a half million dollars. The Royal Swedish Academy of Sciences announced the winners this week.
In everyday life, there are many things that get in the way of efficient markets. There may not be true competition. Buyers and sellers may keep some information private from each other. Also, the production and use of goods may result in outcomes like pollution or social costs.
Mechanism design theory permits economists to identify situations where markets work well and where they do not. For example, it shows why an auction is generally the most efficient way to sell many kinds of goods.
In fact, experts say the theory explains why a version called a double auction is often the best way to trade. In a double auction, buyers and sellers both make price bids.
The Swedish academy says the theory also explains why there is often no good market solution to providing some goods, like uncrowded roads.
Mechanism design theory is part of the wider economic idea of game theory and it has many uses -- including in political science.
Roger Myerson even built a mathematical model for elections. He found a voting system that he says would have helped Florida avoid its problems in the two thousand presidential election.
The Nobel Prize award ceremonies will take place on December tenth. The official name of the economics award is the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. The Swedish central bank created the prize in nineteen sixty-eight.
Leo Hurwicz was born in Russia in nineteen seventeen. He developed new ways to understand markets. He began his work after World War Two. At ninety years old, he is the oldest person ever to win a Nobel Prize.
And that's the VOA Special English Economics Report, written by Mario Ritter. I'm Bob Doughty.
¤注解¤:
1. mechanism [5mekEnizEm] n. A machine or mechanical appliance. 机械装置, 机构, 机制
2. outcome [5autkQm] n. A natural result 结果, 成果
3. auction [5C:kFEn] n. A public sale in which property or items of merchandise are sold to the highest bidder. 拍卖
4. ceremony [5serimEni] n. A formal act or set of acts performed as prescribed by ritual or custom: 典礼, 仪式
A WiLD Idea: Wireless Long-Distance Internet for Rural Poor
Written by Jill Moss
November 19th, 2007
This is the VOA Special English Development Report.
Eric Brewer is a busy man. He is a computer science professor at the University of California, Berkeley. He is also director of the Intel Research Berkeley Lab. There, he leads a team of students and Intel company researchers on projects with new technologies.
One of their creations is a WiFi-based long distance network, or WiLDNet. Wi-Fi is short for wireless fidelity. Wi-Fi connections, or hot spots, can be found in airports, hotels, coffee shops and many other places.
But Wi-Fi is designed for short distances. Eric Brewer predicts that most WiLDNets will only need to cover several kilometers of territory. Yet, in Venezuela, a network using WiLDNet technology and special software reaches over three hundred eighty kilometers.
Each endpoint in a WiLDNet uses a router that takes only about seven watts of power. It can be powered by car batteries, energy from the sun or electricity from a local provider.
The routers cost about four hundred dollars. But Eric Brewer tells us the price should be less once the technology is finalized for mass production. The networks use antennas aided by relays in places where they cannot be stationed in direct line of sight of one another.
WiLDNets can be used for humanitarian or business purposes or both. The hope is that companies will expand connectivity in rural markets.
Rural schools in Ghana and the Philippines are using WiLDNets to connect to the Internet. And in Guinea-Bissau, networks are being used to link community radio stations.
In southern India, a WiLDNet connects eye-care centers in poor villages to an eye hospital in the city of Theni. Villagers receive care from doctors at the hospital through videoconferencing. So far, thirty thousand patients have been examined this way. Eric Brewer says three thousand patients with especially serious vision problems now are able to see much better as a result of their care.
One more thing about Professor Brewer: he is a former billionaire. He and a Berkeley graduate student formed the Internet search company Inktomi in nineteen ninety-six. It became profitable. But the dot-com crash and rising competition from shook the company and it was sold to Yahoo in two thousand three.
And that's the VOA Special English Development Report, written by Jill Moss.
¤注解¤:
1. fidelity [fi5deliti] n. (收音机, 录音设备等的)逼真度
2. router [5rautE] n.刳刨者, 刳刨工具, 刳刨机
3. antenna [An5tenE] n. 天线
4. billionaire [biljE5nZE] n. A person whose wealth amounts to at least a billion dollars 亿万富翁
'Agflation' Raises Grain Prices, but Not Corn Ethanol
Written by Mario Ritter
October 5th, 2007
This is the VOA Special English Economics Report.
Right now, many people around the world are feeling the pain of "agflation." Agricultural inflation has been hitting the price of grains and other products. Food prices have risen under pressure from energy costs and growing world demand for food, as well as local problems like the weather.
In the United States, grain prices are reaching historic highs. And supplies have dropped to lows not seen since the nineteen seventies. For one of America's leading crops, the growing use of corn to make fuel has driven up the price.
The government has strongly supported ethanol production. In two thousand five, Congress set a national goal of using twenty-eight billion liters of ethanol a year by two thousand twelve. President Bush and Congress have since expanded that goal. As a result, farmers are planting more corn.
But more hectares of maize for ethanol mean fewer hectares for crops like soybeans. Meat producers now have to pay more for soybeans because there is less available for animal feed. This is how corn-based ethanol affects the price of meat products.
Rising grain prices could signal a change for agricultural commodities around the world.
For years, developing countries have opposed government support for farmers in wealthy nations. They make the case that farm subsidies drive down prices for agricultural products, hurting poor farmers. Subsidies have been one of the major disputes limiting progress in the Doha development round of world trade talks.
Now, there is worry that the increasing demand for food could drive prices too high, hurting the buying power of the world's poor.
Many developing countries have a growing middle class. More people than ever have money to buy high-value agricultural products like meat and milk. In China, for example, Premier Wen Jiabao has called for increased milk production. More milking cows means the need for more feed.
Yet prices are not rising for all agriculture-based products. In the United States, while the price of corn remains high, it has not affected ethanol prices. In fact, in recent months, those prices have dropped about thirty percent. Production has expanded faster than demand, so now there is a big oversupply of ethanol.
And that's the VOA Special English Economics Report, written by Mario Ritter. Transcripts and archives of our broadcasts are at voaspecialenglish.com. I'm Steve Ember.
¤注解¤:
1. ethanol [5eWEnC:l, -nEul] n. 乙醇, 酒精
2. maize [meiz] n. 玉米, 黄色
3. soybean [`sRIbi:n] n. 大豆
4. oppose [E5pEuz] vt. To be resistant to 反对, 使对立, 使对抗, 抗争
Bush Announces Some Troops Will Leave Iraq; Democrats Want More
Written by Brianna Blake
September 15th, 2007
This is IN THE NEWS in VOA Special English.
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