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Two-Sided Matching with Endogenous Preferences

Antler, Yair (2015) 'Two-Sided Matching with Endogenous Preferences.' American Economic Journal: Microeconomics, 7 (3). 241 - 258. ISSN 1945-7669

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We modify the stable matching problem by allowing agents' preferences to depend on the endogenous actions of agents on the other side of the market. Conventional matching theory results break down in the modified setup. In particular, every game that is induced by a stable matching mechanism (e.g., the Gale-Shapley mechanism) may have equilibria that result in matchings that are not stable with respect to the agents' endogenous preferences. However, when the Gale-Shapley mechanism is slightly modified, every equilibrium of its induced game results in a pairwise stable matching with respect to the endogenous preferences as long as they satisfy a natural reciprocity property.

Item Type: Article
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences > Economics, Department of
Depositing User: Jim Jamieson
Date Deposited: 01 Sep 2016 09:38
Last Modified: 02 Nov 2020 11:15

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