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On the integration of Shapley–Scarf markets

Author

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  • Kumar, Rajnish
  • Manocha, Kriti
  • Ortega, Josué

Abstract

We study the welfare consequences of merging Shapley–Scarf markets. Market integration can lead to large welfare losses and make the vast majority of agents worse-off, but is on average welfare-enhancing and makes all agents better off ex-ante. The number of agents harmed by integration is a minority when all markets are small or agents’ preferences are highly correlated.

Suggested Citation

  • Kumar, Rajnish & Manocha, Kriti & Ortega, Josué, 2022. "On the integration of Shapley–Scarf markets," Journal of Mathematical Economics, Elsevier, vol. 100(C).
    • Handle: RePEc:eee:mateco:v:100:y:2022:i:c:s0304406822000027
    DOI: 10.1016/j.jmateco.2022.102637
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