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Stable matching in large markets with occupational choice

Author

Listed:
  • Carmona, Guilherme

    (School of Economics, University of Surrey)

  • Laohakunakorn, Krittanai

    (School of Economics, University of Surrey)

Abstract

We introduce a model of large many-to-one matching markets with occupational choice where each individual can choose which side of the market to belong to. We show that stable matchings exist under mild assumptions; in particular, both complementarities and externalities can be accommodated. Our model generalizes Greinecker and Kah (2021), which focuses on one-to-one matching and did not allow for occupational choice. Applications include the roommate problem with non-atomic participants, explaining the size and distribution of firms and wage inequality.

Suggested Citation

  • Carmona, Guilherme & Laohakunakorn, Krittanai, 2024. "Stable matching in large markets with occupational choice," Theoretical Economics, Econometric Society, vol. 19(3), July.
    • Handle: RePEc:the:publsh:5915
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    References listed on IDEAS

    as
    1. Sasaki, Hiroo & Toda, Manabu, 1996. "Two-Sided Matching Problems with Externalities," Journal of Economic Theory, Elsevier, vol. 70(1), pages 93-108, July.
    2. Sherwin Rosen, 1982. "Authority, Control, and the Distribution of Earnings," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 311-323, Autumn.
    3. 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.
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    Cited by:

    1. Hideo Konishi & Dimitar Simeonov, 2025. "Competing Teams in Large Markets: Free Entry Equilibrium with (Sub-)Optimal Contracts," Boston College Working Papers in Economics 1095, Boston College Department of Economics.

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    More about this item

    Keywords

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    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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