What price stability? Social welfare in matching markets
In two-sided matching markets, stability can be costly. We define social welfare functions for matching markets and use them to formulate a definition of the price of stability. We then show that it is common to find a price tag attached to stability, and that the price of stability can be substantial. Therefore, when choosing a matching mechanism, a social planner would be well advised to weigh the price of stability against the value of stability, which varies from market to market.
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