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Limited farsightedness in priority-based matching

Author

Listed:
  • Ata Atay

    (University of Barcelona and BEAT)

  • Ana Mauleon

    (CEREC and CORE/LIDAM, UCLouvain)

  • Vincent Vannetelbosch

    (CORE/LIDAM, UCLouvain)

Abstract

We consider priority-based matching problems with limited farsightedness. We show that, once agents are sufficiently farsighted, the matching obtained from the Top Trading Cycles (TTC) algorithm becomes stable: a singleton set consisting of the TTC matching is a horizon-$k$ vNM stable set if the degree of farsightedness is greater than three times the number of agents in the largest cycle of the TTC. On the contrary, the matching obtained from the Deferred Acceptance (DA) algorithm may not belong to any horizon-$k$ vNM stable set for $k$ large enough.

Suggested Citation

  • Ata Atay & Ana Mauleon & Vincent Vannetelbosch, 2022. "Limited farsightedness in priority-based matching," UB School of Economics Working Papers 2022/438, University of Barcelona School of Economics.
    • Handle: RePEc:ewp:wpaper:438web
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    File URL: http://hdl.handle.net/2445/191574
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    References listed on IDEAS

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    More about this item

    Keywords

    Priority-based matching; top trading cycle; stable sets; limited farsightedness.;
    All these keywords.

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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