Beauty is a Beast, Frog is a Prince: Assortative Matching with Nontransferabilities

38 Pages Posted: 26 Mar 2012

See all articles by Patrick Legros

Patrick Legros

Université Libre de Bruxelles (ULB) - European Center for Advanced Research in Economics and Statistics (ECARES); Northeastern University, department of economics; Centre for Economic Policy Research (CEPR)

Andrew F. Newman

Boston University - Department of Economics

Date Written: December 25, 2006

Abstract

We present sufficient conditions for monotone matching in environments where utility is not fully transferable between partners. These conditions involve not only complementarity in types of the total payoff to a match, as in the transferable utility case, but also monotonicity in type of the degree of transferability between partners. We apply our conditions to study some models of risk sharing and incentive problems, deriving new results for predicted matching patterns in those contexts.

Keywords: Assortative matching, nontransferable utility, risk sharing, intrahouse-hold allocation, principal-agent

JEL Classification: C78, D13, J41

Suggested Citation

Legros, Patrick and Newman, Andrew F., Beauty is a Beast, Frog is a Prince: Assortative Matching with Nontransferabilities (December 25, 2006). Econometrica, Vol. 75, No. 4, pp. 1073-1102, July 2007. Available at SSRN: https://ssrn.com/abstract=2028540

Patrick Legros (Contact Author)

Université Libre de Bruxelles (ULB) - European Center for Advanced Research in Economics and Statistics (ECARES) ( email )

Ave. Franklin D Roosevelt, 50 - C.P. 114
Brussels, B-1050
Belgium
+32 2 650 4219/3 (Phone)
+32 2 650 4475 (Fax)

Northeastern University, department of economics ( email )

301 Lake Hall
Boston, MA 02115
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Andrew F. Newman

Boston University - Department of Economics ( email )

270 Bay State Road
Boston, MA 02215
United States
617-358-4354 (Phone)
617-353-4143 (Fax)

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