Header

UZH-Logo

Maintenance Infos

Stability and preference alignment in matching and coalition formation


Pycia, Marek (2012). Stability and preference alignment in matching and coalition formation. Econometrica, 80(1):323-362.

Abstract

We study matching and coalition formation environments allowing complementarities and peer effects. Agents have preferences over coalitions, and these preferences vary with an underlying, and commonly known, state of nature. Assuming that there is substantial variability of preferences across states of nature, we show that there exists a core stable coalition structure in every state if and only if agents' preferences are pairwise‐aligned in every state. This implies that there is a stable coalition structure if agents' preferences are generated by Nash bargaining over coalitional outputs. We further show that all stability‐inducing rules for sharing outputs can be represented by a profile of agents' bargaining functions and that agents match assortatively with respect to these bargaining functions. This framework allows us to show how complementarities and peer effects overturn well known comparative statics of many‐to‐one matching.

Abstract

We study matching and coalition formation environments allowing complementarities and peer effects. Agents have preferences over coalitions, and these preferences vary with an underlying, and commonly known, state of nature. Assuming that there is substantial variability of preferences across states of nature, we show that there exists a core stable coalition structure in every state if and only if agents' preferences are pairwise‐aligned in every state. This implies that there is a stable coalition structure if agents' preferences are generated by Nash bargaining over coalitional outputs. We further show that all stability‐inducing rules for sharing outputs can be represented by a profile of agents' bargaining functions and that agents match assortatively with respect to these bargaining functions. This framework allows us to show how complementarities and peer effects overturn well known comparative statics of many‐to‐one matching.

Statistics

Citations

Dimensions.ai Metrics
44 citations in Web of Science®
50 citations in Scopus®
100 citations in Microsoft Academic
Google Scholar™

Altmetrics

Downloads

55 downloads since deposited on 05 Jun 2018
50 downloads since 12 months
Detailed statistics

Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Economics
Dewey Decimal Classification:330 Economics
Uncontrolled Keywords:Many-to-one matching, assortative matching, coalition formation, stability, core, complementarities, peer effects, sharing rules, consistency, Nash bargaining
Language:English
Date:January 2012
Deposited On:05 Jun 2018 10:20
Last Modified:24 Sep 2019 23:30
Publisher:Wiley-Blackwell Publishing, Inc.
ISSN:0012-9682
OA Status:Green
Publisher DOI:https://doi.org/10.3982/ECTA7143

Download

Green Open Access

Download PDF  'Stability and preference alignment in matching and coalition formation'.
Preview
Content: Published Version
Filetype: PDF
Size: 277kB
View at publisher