Incentives and implementation in marriage markets with externalities

Abstract

We study the implementability of stable correspondences in marriage markets with externalities.We prove that, contrary to what happens in markets without externalities, no stable revelation mechanism makes a dominant strategy for the agents on one side of the market to reveal their preferences. However, the stable correspondence is implementable in Nash equilibrium.Economic Literature Classication Numbers: C72, C78, D62, D78.

Expectations, Cores, and Strategy-Proofness Under Externalities

“…), dP j c for some j ∈ T c ⇒ cP k d for some k ∈ T c } for all i ∈ T . 16 If expectations are complementary efficient and coalition T announces b, each agent in T expects that the agents outside T will not choose an inefficient allocation once (b (i)) i∈T is taken as given. We call complementary efficient core, denoted by C P E , the core resulting from complementary efficient expectations.…”