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Market for Office Furniture

Context: All offices purchase furniture, generally this is done by having office staff submit requests to their organization (a university department, or other governing body which manages other offices as well). In many cases, these organizations allocate money to office needs based on historical costs.

I think it is useful to analyze the market for office furniture at two different scopes: intra-organizational and inter-organizational. First I will analyse the intra-organizational market:

The allocating body has some pool of resources allocated towards furniture and absorbs all costs; no currency is used with respect to offices.

Every office has a value function, and therefore a preference ordering, over furniture. Given this preference ordering, they request furniture from the allocating body. I am not sure what sort of allocation schemes organizations generally use, I can assume that it is some function of the office’s reported preferences and the item’s cost. I assume that any allocation process that the organization cannot fulfill (for lack of resources) will be reset, allowing offices to re-represent preferences. However, I can show that no allocation scheme in this setting is strategyproof. An office can always report exaggerated value for its most preferred items, and exaggerated lack of value / dispreference towards less preferred items.

  • If offices are asked to list satisfying items, offices who list more expensive items will be given more expensive items than those who list cheaper ones.
  • If offices are given a certain amount of currency specific to the market (furniture dollars), they will spend it all and never report an ability to have spent less
  • If offices are asked to evaluate items, offices can report manipulated preferences freely, so any scheme designed to maximize (value – cost) will fail to be strategyproof.

I would argue that the inter-organizational network is not a meaningfully networked economy. This is because:

  • Office furniture is priced via quote (that is, prices are not publicly visible or universal)
  • Office furniture is usually very expensive to transport, so organizations generally do not trade among themselves
  • Organizations are not equipped to bid on furniture in a cost-minimizing way, further reducing an incentive to trade among themselves or prefer transparently priced items


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