Stable Matching with Incomplete Information
73 Pages Posted: 22 Jun 2013
Date Written: June 17, 2013
Abstract
We formulate a notion of stable outcomes in matching problems with one-sided asymmetric information. The key conceptual problem is to formulate a notion of a blocking pair that takes account of the inferences that the uninformed agent might make. We show that the set of stable outcomes is nonempty in incomplete-information environments, and is a superset of the set of complete-information stable outcomes. We then provide sufficient conditions for incomplete-information stable matchings to be efficient. Lastly, we define a notion of price-sustainable allocations and show that the set of incomplete-information stable matchings is a subset of the set of such allocations.
Keywords: Matching, Stability, Stable outcome, Incomplete information, Core
JEL Classification: C71, C78, D5, D
Suggested Citation: Suggested Citation