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Markets in everything, family auction edition
David Altshuler recently bid at auction for a vintage necktie.
The event wasn't set up by an auction house or to benefit a charity. Instead, he was bidding against his two siblings in a private, Web-based auction that they held to divvy up their late father's personal property.
Distributing a family's tangible belongings -- often mundane knickknacks with far more sentimental value than monetary worth -- has long had the potential to ignite family feuds. Divorce and second marriages can add to the tension, as children and stepfamilies vie for valued objects.
Now, families and estate planners increasingly are turning to a number of novel strategies, including family auctions and a round-robin selection strategy, to divide tangible property without splitting families apart. Recent online tools also can help family members divide up a parent's belongings.
Here is the (gated) article (WSJ). For the pointer, thanks to both Don Boudreaux and a Sr. McKethan.
Posted by Tyler Cowen on April 19, 2007 at 05:45 PM in Economics | Permalink
Comments
In a hilarious scene from Cryptonomicon, the mathematically-inclined Waterhouse family divides up family heirlooms. The clan devises a scheme by which members create a graph of sorts, with the origin at (0,0) representing no value, while each family member can adjust the value an item according to sentimental value along one axis and monetary value on the other.
In the end, I don't think the result would be dissimilar from what's described here.
Posted by: Jake at Apr 20, 2007 1:12:44 AM
I don't think the result would be dissimilar
If you remember the outcome from Cryptonomicon, you should hope the result
*would* be dissimilar - because as I recall one of Waterhouse's canny
relatives games the setup to force him to accede to her wishes. Don't
remember the details. But to the extent the scene had a point it was that
abstract schemes like this are no match for human deviousness.
Posted by: bbartlog at Apr 20, 2007 10:32:26 AM
Bbartlog,
You've got it generally right, but it's worse than you remember. The family has a destested aunt-in-law who likes to hurt people. The men of the family explicitly come up with this highly mathematical approach because in the Waterhouse family the men do math and the women do obscure linquistics -- and this aunt's husband is not around.
Unfortunately, (1) our protagonist inadvertently reveals to the hated Aunt what he wants and (2) the hated Aunt intuits the perfect mathematical move to screw our protagonist
Happily our hero realizes that the optimization problem is not well specified, so he screws with the algorithm code to get the results he wants, anyway.
Lesson: you don't want the Cryptonomicon solution *unless* you're the one writing the code.
Posted by: tylerh at Apr 20, 2007 1:02:11 PM
wait wait wait. she didn't mess with the protagonist. she followed the rules. the problem was that he, as auctioneer, was supposed to be impartial. instead, there was something he really wanted from the auction. so she, in order to get what she wanted, highly valued the thing he wanted, knowing he'd be inclined to cheat to get her what she wanted, so he could get what he wanted.
so the auctioneer cheated. that was the point. that's why you don't want to follow their auction.
Posted by: anonymous at Apr 20, 2007 5:24:55 PM
Random interesting semi-related fact.
Family auctions have been common in the Plain world for a long time.
Posted by: SamChevre at Apr 20, 2007 6:56:44 PM
The big advantage that the schemes Tyler mentions over the occurances in Cryptonomicon (I'm amused that so many people instantly thought of that) is, of course, that with the advent of web-based tools nobody has to go lugging furniture around in a parking lot in the snow.
I can't read the WSJ article, but the blog post I linked to mentions the same concept being used for splitting assets in a divorce.
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Posted by: 謝文豪 at Apr 2, 2008 2:42:45 AM
