Thick, Uncongested and Safe

Successful marketplaces require three key elements. “They must be thick, uncongested, and safe,”…

Having sufficient “thickness” means there are enough participants in the market to make it thrive. “Congestion” is what can happen when markets get too thick too fast: there are heaps of potential players, but not enough time for transactions to be made, accepted, or rejected effectively. “Safety” refers to an environment in which all parties feel secure enough to make decisions based on their best interests, rather than attempts to game a flawed system.

Al Roth’s three requirements for a marketplace, as described in Working Knowledge. Al’s Market Design blog is well worth subscribing to for any aspiring marketpreneur.

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About Brent

Born to code.
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