Aggregate Stable Matching with Money Burning

40 Pages Posted: 20 Dec 2016 Last revised: 30 Oct 2020

See all articles by Alfred Galichon

Alfred Galichon

NYU, Department of Economics and Courant Institute

Yu-Wei Hsieh


Multiple version iconThere are 2 versions of this paper

Date Written: June 20, 2018


We propose an alternative notion of non-transferable utility (NTU) stability in matching models that relies on money burning. Our model captures an exchange economy with indivisible goods, fixed prices, and no centralized assignment mechanism. In these models, a non-transferable numeraire (e.g., time) becomes the competitive market-clearing device and enforces the property of equal treatment: two identical individuals will end up with the same equilibrium payoffs. First, we provide a precise connection between our proposed equilibrium concept and the usual NTU stability. Second, by introducing a random utility component, we obtain an NTU counterpart to Choo and Siow's (2006) model. Finally, we provide a dynamic interpretation of the proposed equilibrium concept in a stationary model of market clearing with queues.

Keywords: two-sided matching; non-transferable utility matching; rationing by waiting; non-price rationing; aggregate matching; matching function; disequilibrium; discrete choice; optimal transport

JEL Classification: C78, D58

Suggested Citation

Galichon, Alfred and Hsieh, Yu-Wei, Aggregate Stable Matching with Money Burning (June 20, 2018). Available at SSRN: or

Alfred Galichon (Contact Author)

NYU, Department of Economics and Courant Institute ( email )

269 Mercer Street, 7th Floor
New York, NY 10011
United States

Yu-Wei Hsieh

Amazon ( email )

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