Working Paper: CEPR ID: DP15637
Authors: Marina Agranov; Ahrash Dianat; Larry Samuelson; Leeat Yariv
Abstract: We experimentally study decentralized one-to-one matching markets with transfers. We vary the information available to participants, complete or incomplete, and the surplus structure, supermodular or submodular. Several insights emerge. First, while markets often culminate in efficient matchings, stability is more elusive, reflecting the difficulty of arranging attendant transfers. Second, incomplete information and submodularity present hurdles to efficiency and especially stability; their combination drastically diminishes stability's likelihood. Third, matchings form "from the top down" in complete-information supermodular markets, but exhibit many more and less-obviously ordered offers otherwise. Last, participants' market positions matter far more than their dynamic bargaining styles for outcomes.
Keywords: matching; incomplete information; stability; experiments
JEL Codes: No JEL codes provided
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| complete information (D83) | efficiency (D61) |
| complete information (D83) | stability (C62) |
| incomplete information + submodular surplus structures (D89) | efficiency (D61) |
| incomplete information + submodular surplus structures (D89) | stability (C62) |
| information structure (L15) | order of match formation (C78) |
| agent type (L85) | payoffs (J33) |