In matching problems with externalities, prudence measures the importance given to potential reactions when evaluating a deviation; social connectedness, on the other hand, measures the capacity to react to such deviations. Intuitively, a matching problem should be more likely to have a stable...

We study coalitional stability in matching problems with externalities, including marriage markets, roommate problems, and Shapley-Scarf housing markets as particular cases. When preferences are randomly determined, the probability of having a coalitionally stable solution is positively affected...

In classical school choice contexts there exists a centralized assignment procedure that is stable and strategy-proof: the Gale-Shapley student-optimal stable mechanism. We show that this property is not satisfied when externalities are incorporated into the model, even in scenarios in which...