Farsighted Stability for Roommate Markets
18 Pages Posted: 27 May 2009
Date Written: May 26, 2009
Using a bi-choice graph technique (Klaus and Klijn, 2009), we show that a matching for a roommate market indirectly dominates another matching if and only if no blocking pair of the former is matched in the latter (Proposition 1). Using this characterization of indirect dominance, we investigate von Neumann-Morgenstern farsightedly stable sets. We show that a singleton is von Neumann-Morgenstern farsightedly stable if and only if the matching is stable (Theorem 1). We also present roommate markets with no and with a non-singleton von Neumann-Morgenstern farsightedly stable set (Examples 1 and 2).
Keywords: core, farsighted stability, one- and two-sided matching, roommate markets, von Neumann-Morgenstern stability
JEL Classification: C62, C71, C78
Suggested Citation: Suggested Citation