Decentralized Matching with Aligned Preferences

41 Pages Posted: 7 Apr 2009 Last revised: 11 Nov 2013

See all articles by Muriel Niederle

Muriel Niederle

Stanford University - Department of Economics; National Bureau of Economic Research (NBER)

Leeat Yariv

Princeton University

Date Written: April 2009

Abstract

We study a simple model of a decentralized market game in which firms make directed offers to workers. We focus on markets in which agents have aligned preferences. When agents have complete information or when there are no frictions in the economy, there exists an equilibrium that yields the stable match. In the presence of market frictions and preference uncertainty, harsher assumptions on the richness of the economy have to be made in order for decentralized markets to generate stable outcomes in equilibrium.

Suggested Citation

Niederle, Muriel and Yariv, Leeat, Decentralized Matching with Aligned Preferences (April 2009). NBER Working Paper No. w14840. Available at SSRN: https://ssrn.com/abstract=1373349

Muriel Niederle (Contact Author)

Stanford University - Department of Economics ( email )

Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Leeat Yariv

Princeton University ( email )

Princeton, NJ 08544-1021
United States

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