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Contract Terms Monotonicity in Matching Markets

Author

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  • Cyril Rouault

    (CEPS - Centre d'Economie de l'ENS Paris-Saclay - Université Paris-Saclay - ENS Paris Saclay - Ecole Normale Supérieure Paris-Saclay)

Abstract

We investigate how adding contract terms affects stable allocations in the doctor-hospital matching market. Surprisingly, expanding term options may decrease doctors' welfare, even if the added terms are used. We propose removing specific terms to achieve a Pareto improvement for doctors. We analyze two preference domains: lexicographic and continuous, and identify conditions guaranteeing that if one of the added terms is used, at least one doctor is better off. Under continuous preferences, some doctors may always be worse off. Lastly, we investigate the incentives for hospitals to offer contract terms. When a mechanism generates the hospital-optimal stable allocation, hospitals are incentivized to expand the set of terms they offer.

Suggested Citation

  • Cyril Rouault, 2023. "Contract Terms Monotonicity in Matching Markets," Working Papers hal-04352427, HAL.
    • Handle: RePEc:hal:wpaper:hal-04352427
    Note: View the original document on HAL open archive server: https://hal.science/hal-04352427v2
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