Professor McCabe, who began programming market experiments (using the PLATO Computer System) during the mid-1980s, has done extensive work in experimental economics, and helped pioneer the field of neuroeconomics. His current focus is computational microeconomic systems: computation-based institutions that facilitate exchange. The microeconomic systems framework was first developed by the Nobel Prize-winning economist Leonid Hurwicz, the pioneer of mechanism design theory. It was later applied and extended by another Nobel Prize winner, Vernon Smith, who is a collaborator of McCabe’s.
McCabe’s workshop, Research Experience for Undergraduates, is centered at George Mason’s Computational Economics Laboratory (CELab), though for obvious reasons all the participants are working remotely this year. CELab’s mission is “to build a computational framework for exchange, validated by experiments, to understand how humans interact with institutions, and to discover institution rules that best facilitate exchange.” The research focus this summer is on the role of escrow in facilitating exchange, in particular to study how escrow institutions affect behavior and facilitate exchange. What follows is an edited transcript of our discussion with Professor McCabe. What follows is an edited transcript of a discussion between Professor McCabe and Agoric economist Bill Tulloh.