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Stability and immunity to capacity manipulation in large matching markets

Author

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  • Honarvar, Morteza
  • Kamali Shahdadi, Behrang

Abstract

Stable mechanisms are not strategy-proof in matching markets; however, they work well in practice. We study the college admission problem where colleges have completely heterogeneous preferences, and there is a continuum of students. We find an upper bound for the colleges’ capacities vector such that colleges have the incentive to report their capacities truthfully in any stable mechanism.

Suggested Citation

  • Honarvar, Morteza & Kamali Shahdadi, Behrang, 2021. "Stability and immunity to capacity manipulation in large matching markets," Economics Letters, Elsevier, vol. 206(C).
    • Handle: RePEc:eee:ecolet:v:206:y:2021:i:c:s0165176521002792
    DOI: 10.1016/j.econlet.2021.110002
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    References listed on IDEAS

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    1. repec:oup:restud:v:84:y::i:1:p:444-463. is not listed on IDEAS
    2. Alvin E. Roth, 2002. "The Economist as Engineer: Game Theory, Experimentation, and Computation as Tools for Design Economics," Econometrica, Econometric Society, vol. 70(4), pages 1341-1378, July.
    3. Roth, Alvin E., 1985. "The college admissions problem is not equivalent to the marriage problem," Journal of Economic Theory, Elsevier, vol. 36(2), pages 277-288, August.
    4. Azevedo, Eduardo M., 2014. "Imperfect competition in two-sided matching markets," Games and Economic Behavior, Elsevier, vol. 83(C), pages 207-223.
    5. Eduardo M. Azevedo & Jacob D. Leshno, 2016. "A Supply and Demand Framework for Two-Sided Matching Markets," Journal of Political Economy, University of Chicago Press, vol. 124(5), pages 1235-1268.
    6. Fuhito Kojima & Parag A. Pathak, 2009. "Incentives and Stability in Large Two-Sided Matching Markets," American Economic Review, American Economic Association, vol. 99(3), pages 608-627, June.
    7. Elliott Peranson & Alvin E. Roth, 1999. "The Redesign of the Matching Market for American Physicians: Some Engineering Aspects of Economic Design," American Economic Review, American Economic Association, vol. 89(4), pages 748-780, September.
    8. Alvin E. Roth, 1982. "The Economics of Matching: Stability and Incentives," Mathematics of Operations Research, INFORMS, vol. 7(4), pages 617-628, November.
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    Cited by:

    1. Hagen, Martin, 2022. "Tradable immigration quotas revisited," Journal of Public Economics, Elsevier, vol. 208(C).

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    More about this item

    Keywords

    Matching theory; Market design; Large market;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design

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