We incorporate externalities into the stable matching theory of two-sided markets. Extending the classical substitutes condition to markets with externalities, we establish that stable matchings exist when agent choices satisfy substitutability. We show that substitutability is a necessary...

We study many-to-one matching markets in a dynamic framework with the following features: Matching is irreversible, participants exogenously join the market over time, each agent is restricted by a quota, and agents are perfectly patient. A form of strategic behavior in such markets emerges: The...

We show that several classical results (the existence of a worker-optimal stable allocation, the rural hospitals theorem, the group-strategy-proofness of the worker-optimal stable mechanism) extend from the discrete to the continuous case in a generalized job matching model

We consider a hybrid model at the intersection of the standard two-sided matching market as proposed by Gale and Shapley (1962) and a housing market as proposed by Shapley and Scarf (1974). Two sets of agents have to be matched in pairs to a common set of objects. Agents of one type have...

We show how frictions and continuous transfers jointly affect equilibria in a model of matching in trading networks. Our model incorporates distortionary frictions such as transaction taxes, bargaining costs, and incomplete markets. When contracts are fully substitutable for firms, competitive...

We give a direct proof of one-sided strategy-proofness for worker-firm matching under continuously transferable utility. A new “Lone Wolf” theorem (Jagadeesan et al. (2017)) for settings with transferable utility allows us to adapt the method of proving one-sided strategy-proofness that is...

Governments often provide employers with financial incentives which depend on the sets of people they hire. Studying such fiscal policies in a classical job matching framework, we provide a necessary and sufficient condition for a policy to preserve the substitute condition (for all revenue...

School choice mechanisms are typically constrained, with students allowed to report preferences on a limited number of schools only Under constraints, the deferred acceptance mechanism (DA) is manipulable and it is unclear how students should play in DA. In order to provide advice to...

Since no stable matching mechanism can induce truth-telling as a dominant strategy for all participants, there is often room in matching markets for strategic misrepresentation (Roth). In this paper we study a natural form of strategic misrepresentation: reporting a truncation of one's true...

We study the incentives from a two-sided platform to segment the market by providing personalized search results. In our environment, a monopolistic platform is in charge of matching sellers with buyers. Upon being matched, each pair of buyer and seller negotiate prices. If they choose to...