I magine that someone gave you 300 million pounds of food and asked you to distribute it to the poor-through food banks-all across the United States. The nonprofit Feeding America faces this problem every year. The food in question is donated to Feeding America by manufacturers and distributors across the United States. As an example, a Walmart in Georgia could have 25,000 pounds of excess tinned fruit at one of its warehouses and give it to Feeding America to distribute to one of 210 regional

more »

... ood banks. How should this be accomplished? This is a problem where regular markets are off the table: Feeding America does not sell food to the food banks. Instead, Feeding America has to find some other way to satisfy its desire for food to go where it is needed most. One way would be to simply assign food to each food bank. This is how most nonprofits allocate resources. However, a field of economics-often associated with the Nobel Prize winning contributions of Al Roth-has been aimed at designing mechanisms so that outcomes in such nonmarket settings can better reflect what consumers want. This area of research has made enormous advances, both theoretical and practical, in problems such as the allocation of children to schools, kidneys to patients, and medical students to hospital residencies (for examples, see Abdulkadiroglu,