Choice or competition: does integration benefit everyone?

Yuichiro Kamada () and Fuhito Kojima ()
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Yuichiro Kamada: Haas School of Business, University of California, Berkeley and Department of Economics, University of Tokyo
Fuhito Kojima: Department of Economics, University of Tokyo

Theoretical Economics, Forthcoming

Abstract: Matching markets are often fragmented, organized at a small local level. While integration of matching markets may lead to welfare gains by expanding choice, it may also harm some market participants by increasing competition for the same resources. We show that every "good" mechanism fails the monotonicity requirement that no individuals be hurt by integration. Then we provide characterization results that identify conditions under which monotonicity becomes compatible with other desirable properties of matching mechanisms.

Keywords: Matching; choice; competition; fragmentation; integration; monotonicity; Pareto efficiency; strategy-proofness; deferred acceptance (search for similar items in EconPapers)
JEL-codes: C70 C78 D47 D61 D63 (search for similar items in EconPapers)
Date: 2025-06-11
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