Compromises and Rewards: Stable and Non-manipulable Probabilistic Pairing

Research output: Working paper

Abstract

Can we reconcile stability with non-manipulability in pairing problems by selecting lotteries over matchings?We examine the problem of eliciting preferences to make pairs as introduced by Gale and Shapley (1962). We develop ex-ante notions of stability and non-manipulability that are parameterized by collections of utility functions. In particular, we study the collection of utility functions with increasing differences for which stability and non-manipulability turn out to characterize Compromises and Rewards. This is a novel rule that is fundamentally different from the one that has attracted most attention in the literature, Deferred Acceptance.

Details

Authors
  • Jens Gudmundsson
Organisations
Research areas and keywords

Subject classification (UKÄ) – MANDATORY

  • Economics

Keywords

  • Rewards, Compromises, Non-manipulability, Stability, Lottery, Pairing
Original languageEnglish
PublisherDepartment of Economics, Lund Universtiy
Number of pages27
Publication statusPublished - 2015
Publication categoryResearch

Publication series

NameWorking Paper / Department of Economics, School of Economics and Management, Lund University
No.32