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Two-Sided Matching via Balanced Exchange: Tuition and Worker Exchanges

52 Pages Posted: 25 Nov 2012 Last revised: 10 Mar 2015

Umut Mert Dur

North Carolina State University

M. Utku Ünver

Boston College - Department of Economics

Date Written: March 9, 2015


We introduce a new matching model to mimic two-sided exchange programs such as tuition and worker exchange, in which each firm has to avoid being a net-exporter of workers. These exchanges use decentralized markets, making it difficult to achieve a balance between exports and imports. We show that stable equilibria discourage net-exporting firms from exchange. We introduce the two-sided top-trading-cycles mechanism that is balanced-efficient, worker-strategy-proof, acceptable, and individually rational, and respects priority bylaws regarding worker eligibility. We prove that it is the unique mechanism fulfilling these objectives. Moreover, it encourages exchange, since full participation is the dominant strategy for firms.

Keywords: Market Design, Matching Theory, Tuition Exchange, Worker Exchange, Balanced Exchange, Two–sided Matching, Two–sided Top Trading Cycles

JEL Classification: C71, C78, D71, D78

Suggested Citation

Dur, Umut Mert and Ünver, M. Utku, Two-Sided Matching via Balanced Exchange: Tuition and Worker Exchanges (March 9, 2015). Available at SSRN: or

Umut Mert Dur (Contact Author)

North Carolina State University ( email )

Hillsborough Street
Raleigh, NC 27695
United States

Utku Unver

Boston College - Department of Economics ( email )

140 Commonwealth Ave.
Chestnut Hill, MA 02467
United States
+1 (617) 552 2217 (Phone)
+1 (617) 552 2318 (Fax)


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