Matching Unskilled/Skilled Workers to Firms Facing Budget Constraints

Amirreza Ahmadzadeh and Behrang Kamali-Shahdadi

No 23-1446, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We study a matching model in which firms face budget constraints. If the pro-duction function only depends on a firm’s technology, a weak stable matching always exists; furthermore, when a strong stable matching does not exist, there is a nearby budget vector for firms such that a strong stable matching exists for the problem with perturbed budgets. If the production function is multiplicative, one can reach a strong stable matching by changing the budget of firms such that the total budget remains the same and each firm’s budget change is bounded by the value of at most one worker for that firm.

Keywords: Matching Theory; Market Design; Labor Market (search for similar items in EconPapers)
JEL-codes: C71 C78 D47 (search for similar items in EconPapers)
Date: 2023-06-12
New Economics Papers: this item is included in nep-bec, nep-des, nep-mfd and nep-mic
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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:128153

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