American Economic Review Vol. 95 No. 4 2005
Matching with Contracts
Abstract
We develop a model of matching with contracts which incorporates, as special cases, the college admissions problem, the Kelso-Crawford labor market matching model, and ascending package auctions. We introduce a new “law of aggregate demand” for the case of discrete heterogeneous workers and show that, when workers are substitutes, this law is satisfied by profit-maximizing firms. When workers are substitutes and the law is satisfied, truthful reporting is a dominant strategy for workers in a worker-offering auction/matching algorithm. We also parameterize a large class of preferences satisfying the two conditions.
- DOI
- 10.1257/0002828054825466
- Volume
- 95
- Issue
- 4
- Pages
- 913-935
- Language
- en
- Sources
- bibtex:phds-export.bib crossref openalex