Stable Matching with Incomplete Information, Second Version
AbstractWe formulate a notion of stable outcomes in matching problems with one-sided asymmetric information. The key conceptual problem is to formulate a notion of a blocking pair that takes account of the inferences that the uninformed agent might make from the hypothesis that the current allocation is stable. We show that the set of stable outcomes is nonempty in incomplete information environments, and is a superset of the set of complete-information stable outcomes. We then provide sufficient conditions for incomplete-information stable matchings to be efficient. Lastly, we define a notion of price sustainable allocations and show that the set of incomplete- information stable matchings is a subset of the set of such allocations.
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Bibliographic InfoPaper provided by Penn Institute for Economic Research, Department of Economics, University of Pennsylvania in its series PIER Working Paper Archive with number 12-042.
Length: 52 pages
Date of creation: 10 Jan 2010
Date of revision: 28 Oct 2012
Matching; Stability; Stable outcome; Incomplete information; Core;
Other versions of this item:
- Qingmin Liu & George J. Mailath & Andrew Postlewaite & Larry Samuelson, 2012. "Stable Matching with Incomplete Information, Second Version," PIER Working Paper Archive 13-028, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 17 Jun 2013.
- C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
- D5 - Microeconomics - - General Equilibrium and Disequilibrium
- D8 - Microeconomics - - Information, Knowledge, and Uncertainty
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