Advanced Search
MyIDEAS: Login to save this paper or follow this series

Chaos and Unraveling in Matching Markets

Contents:

Author Info

  • Songzi Du
  • Yair Livne
Registered author(s):

    Abstract

    We study how information perturbations can destabilize two-sided matching markets. In our model, agents arrive on the market over two periods, while agents in the first period do not know the types of those arriving later. Agents already present in the market may match early or wait for the small group of new entrants. Despite the lack of discounting or risk aversion, this perturbation creates incentives to match early and leave the market before the new agents arrive. These incentives do not disappear as the market gets large. Moreover, we identify a new adverse phenomenon in this setting: as markets get large the probability of \emph{chaos} -- where no early matching scheme for existing agents is robust to pairwise deviations -- approaches 1. These results are independent of the distribution of agents' types and robust to asymmetries between the two sides of the market. Our findings thus suggest that matching markets are extremely sensitive to institutional details and uncertainty.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://arxiv.org/pdf/1009.0769
    File Function: Latest version
    Download Restriction: no

    Bibliographic Info

    Paper provided by arXiv.org in its series Papers with number 1009.0769.

    as in new window
    Length:
    Date of creation: Sep 2010
    Date of revision:
    Handle: RePEc:arx:papers:1009.0769

    Contact details of provider:
    Web page: http://arxiv.org/

    Related research

    Keywords:

    This paper has been announced in the following NEP Reports:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:arx:papers:1009.0769. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (arXiv administrators).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.