Designing Economic Mechanisms

Designing economic mechanisms refers to the process of creating rules and structures that govern how economic interactions and transactions occur within a particular system. This field is an intersection of economics, game theory, and institutional design, focusing on how to align individual incentives with desired collective outcomes. Key aspects of designing economic mechanisms include: 1. **Incentive Structures**: Creating incentives that motivate individuals and organizations to act in ways that lead to beneficial outcomes for the collective, such as efficiency, fairness, or sustainability.