Non-stationary search and assortative matching

Nicolas Bonneton and Christopher Sandmann

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This paper studies assortative matching in a non‐stationary search‐and‐matching model with non‐transferable payoffs. Non‐stationarity entails that the number and characteristics of agents searching evolve endogenously over time. Assortative matching can fail in non‐stationary environments under conditions for which Morgan (1995) and Smith (2006) show that it occurs in the steady state. This is due to the risk of worsening match prospects inherent to non‐stationary environments. The main contribution of this paper is to derive the weakest sufficient conditions on payoffs for which matching is assortative. In addition to known steady state conditions, more desirable individuals must be less risk‐averse in the sense of Arrow–Pratt.

Keywords: non-stationary random search; assortiative matching; risk preferences; NTU (search for similar items in EconPapers)
JEL-codes: J1 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2025-09-30
New Economics Papers: this item is included in nep-dge and nep-upt
References: Add references at CitEc
Citations:

Published in Econometrica, 30, September, 2025, 93(5), pp. 1635 - 1662. ISSN: 0012-9682

Downloads: (external link)
http://eprints.lse.ac.uk/128639/ Open access version. (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:128639

Access Statistics for this paper

More papers in LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library LSE Library Portugal Street London, WC2A 2HD, U.K.. Contact information at EDIRC.
Bibliographic data for series maintained by LSERO Manager ().