Unravelling in Two-Sided Matching Markets and Similarity of Preferences

This paper investigates the causes and welfare consequences of unravelling in two-sided matching markets. It shows that similarity of preferences is an important factor driving unravelling. In particular, it shows that under the ex-post stable mechanism (the mechanism that the literature focuses on), unravelling is more likely to occur when participants have more similar preferences. It also shows that any Pareto-optimal mechanism must prevent unravelling, and that the ex-post stable mechanism is Pareto-optimal if and only if it prevents unravelling

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Year of publication:	2019
Authors:	Halaburda, Hanna
Publisher:	[S.l.] : SSRN
Subject:	Präferenztheorie \| Theory of preferences \| Suchtheorie \| Search theory \| Pareto-Optimum \| Pareto efficiency \| Matching

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