they certainly can help determine the magnitude of comparative statics effects. But with economic knowledge at its current state, functional form assumptions are never really convincing, and this lends importance to the question I ask and to its answer: One can indeed often draw valid general comparative statics inferences from special cases. . ... these results suggest that comparative statics conclusions obtained in models with special simplifying assumptions can often be significantly generalized. The theorems help to distinguish the critical assumptions of an analysis from the other assumptions that simplify calculations but do not alter the qualitative comparative statics conclusions. In that way, the theorems improve our ability to develop useful models of parts of the economy and to interpret those models accurately. Market design Milgrom describes Market Design this way: Market design is a kind of economic engineering, utilizing laboratory research, game theory, algorithms, simulations, and more. Its challenges inspire us to rethink longstanding fundamentals of economic theory. His work comprises three broad theoretical and practical efforts in the field: auction theory and matching theory, and simplifying participants' message. Organizational and information economics Agency theory Milgrom, together with Bengt Holmstrom, asked what features of a contracting problem would give rise to a simpler, say, linear, incentive scheme (that is, a scheme in which the wage consisted of a base amount plus amounts that were directly proportional to specific performance measures). Previously, most theoretical papers in agency theory assumed that the main problem was to provide an incentive for an agent to exert more effort on just one activity. But in many situations, agents can actually exert unobservable efforts on several different activities. In such contexts, new kinds of incentive problems can arise, since giving an agent more incentive to exert effort on one dimension could cause the agent to neglect other important dimensions. Holmstrom and Milgrom believed that incorporating this multi-dimensional feature of incentive problems would generate implications for optimal incentive design that were more relevant for real world contracting problems. In their 1987 paper, Holmstrom and Milgrom introduced new techniques for studying multidimensional agency problems. The key insight in the Holmstrom-Milgrom paper is that simple linear incentive schemes can become optimal when the agent can monitor the evolution over time of the performance measures on which his compensation will be based. In that paper, an agent continuously chooses the drift of an N-dimensional Brownian motion, contingent on observing