Matching in Networks with Bilateral Contracts

John William Hatfield and Scott Kominers

American Economic Journal: Microeconomics, 2012, vol. 4, issue 1, 176-208

Abstract: We introduce a model in which firms trade goods via bilateral contracts which specify a buyer, a seller, and the terms of the exchange. This setting subsumes (many-to-many) matching with contracts, as well as supply chain matching. When firms' relationships do not exhibit a supply chain structure, stable allocations need not exist. By contrast, in the presence of supply chain structure, a natural substitutability condition characterizes the maximal domain of firm preferences for which stable allocations are guaranteed to exist. Furthermore, the classical lattice structure, rural hospitals theorem, and one-sided strategy-proofness results all generalize to this setting. (JEL C78, D85, D86, L14)

JEL-codes: C78 D85 D86 L14 (search for similar items in EconPapers)
Date: 2012
Note: DOI: 10.1257/mic.4.1.176
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Citations: View citations in EconPapers (49)

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Working Paper: Matching Networks with Bilateral Contracts (2010)
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