Matching with Multilateral Contracts

35 Pages Posted: 6 Jul 2017 Last revised: 6 Feb 2019

See all articles by Marzena J. Rostek

Marzena J. Rostek

University of Wisconsin - Madison

Nathan Yoder

University of Georgia - C. Herman and Mary Virginia Terry College of Business - Department of Economics

Date Written: February 4, 2019

Abstract

In many matching environments, agreements are multilateral and/or have externalities. We show that stability in these environments depends on agents' aggregate choice behavior. Two different conditions on aggregate choice ensure a stable outcome exists. One applies when contracts are substitutes; the other ensures a unique stable outcome even without substitutability. Our results apply matching-theoretic techniques to environments where agents' interactions cannot be described by independent bilateral agreements, and also accommodate markets without a two-sided or supply chain structure. Our equivalent characterization of stability also makes computing stable outcomes easier, even in environments outside the scope of our existence results.

Keywords: Multilateral Matching, Externalities, Matching with Contracts, Stability

JEL Classification: C78, C62, D47, D85

Suggested Citation

Rostek, Marzena J. and Yoder, Nathan, Matching with Multilateral Contracts (February 4, 2019). Available at SSRN: https://ssrn.com/abstract=2997223 or http://dx.doi.org/10.2139/ssrn.2997223

Marzena J. Rostek

University of Wisconsin - Madison ( email )

1180 Observatory Drive
Madison, WI 53703
United States
(608) 262-6723 (Phone)
(608) 262-2033 (Fax)

HOME PAGE: http://www.ssc.wisc.edu/~mrostek

Nathan Yoder (Contact Author)

University of Georgia - C. Herman and Mary Virginia Terry College of Business - Department of Economics ( email )

Athens, GA 30602-6254
United States

HOME PAGE: http://sites.google.com/site/nathanyoderecon/

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