Revisiting stability in one-to-one matching problems

Wouter Vergote

Economic Theory Bulletin, 2019, vol. 7, issue 1, No 5, 59-75

Abstract: Abstract This paper studies the stability of a status quo matching by considering the set of matching locations as a primitive of a one-to-one matching problem, alongside the agents and their preferences. As such we generalize the approach of Morrill (J Econ Theory 145:1739–1756, 2010) who was the first to study matching problems with location restrictions. We develop two novel stability concepts, direct and (coalition-) trade stability, akin to Gale–Shapley stability and Alcalde’s (Econ Des 1:275–287, 1995) concept of exchange stability, respectively, and derive connections with existing stability concepts. We show that coalition-trade stability is a refinement of direct stability. We then demonstrate that when there are no matching restrictions, direct stability is equivalent to Gale–Shapley stability and coalition-trade stability is equivalent to requiring both exchange stability and Gale–Shapley stability. In addition, we reveal a link between trade dominance and indirect dominance, Harsanyi’s farsighted dominance concept. For the class of individually rational matching problems, we show that indirect dominance is a refinement of trade dominance. However, these two dominance notions do not always generate the same stable (set of) matchings.

Keywords: One-to-one matching; Direct dominance; Trade dominance; Indirect dominance (search for similar items in EconPapers)
JEL-codes: C71 C78 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (1)

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DOI: 10.1007/s40505-018-0143-x

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