Cornell Tech | Digital Life Initiative
Design Choice: Mechanism Design’s Digital Drift
Mechanism design is a form of optimization developed in economic theory. It casts economists as institutional engineers, choosing an outcome and then arranging a set of market rules and conditions to achieve it. The toolkit from mechanism design is widely used in economics, policymaking, and now in building and managing online environments. Mechanism design has become one of the most pervasive yet inconspicuous influences on the digital mediation of social life. Its optimizing schemes structure online advertising markets and other multi-sided platform businesses. But as it drifts into new digital world, mechanism design may have morphed into something different, and the normative and practical justifications for using mechanism design to orchestrate human interactions and choices are losing traction. In this paper, Lee McGuigan, Jake Goldenfein, and Salome Viljoen argue that mechanism design, applied in algorithmic environments, has become a tool for producing information domination, distributing social costs in ways that benefit designers, and controlling and coordinating participants in multi-sided platforms.
Lee McGuigan is a Research Fellow at Cornell Tech’s Digital Life Initiative. He is interested in various entanglements of information, technology, markets, and culture. His ongoing work looks at knowledge infrastructures and logistical processes in advertising and media industries. This research helps make sense of today’s “attention merchants” and “choice architects” by examining how related efforts to predict and influence consumer habits and to package and sell audience attention have collectively channeled and amplified currents in surveillance, data processing, and behavioral science. Lee’s scholarship appears in a variety of books and journals, including New Media & Society, Critical Studies in Media Communication, the Journal of Consumer Culture, Media, Culture, & Society, and Television & New Media. He is also co-editor (with Vincent Manzerolle) of The Audience Commodity in a Digital Age, published in 2014 by Peter Lang.