Describing an Allocation Problem: A Checklist

Abstract

The first thing to do when tackling a class of resource allocation problems, more generally as class of decision problems, is to properly describe them. By the way, I’ll also use the term “economy” instead of “problem” although some of the situations I’ll discuss aren’t economies in the traditional sense. The real world is a messy affair, and you’ll have to identify the most salient features of the problems you’re interested in, to choose what to keep and what to ignore. You won’t make any progress if you don’t simplify. What you’ll work with is called a model.