Think microeconomic theory lacks real-world application? Listen to Paul Klemperer describe how he implemented the theory of auctions to help improve Britian’s central banking policy. From The Guardian:
Economist Paul Klemperer of Oxford University describes how he invented an auction based on a new kind of geometry to help the Bank of England as the financial crisis took hold in 2007. The auction got money to the banks and building societies that needed it most urgently. The then governor Mervyn King later called it ‘a marvelous application of theoretical economics to a practical problem of vital importance’. Klemperer describes how similar auctions can help other government departments allocate resources.