Two-Sided Investment and Matching with Multidimensional Cost Types and Attributes

B-Tier
Journal: American Economic Journal: Microeconomics
Year: 2018
Volume: 10
Issue: 3
Pages: 86-123

Score contribution per author:

2.018 = (α=2.02 / 1 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Heterogeneous buyers and sellers must make investments before entering a continuum assignment market. I show that efficient ex post contracting equilibria (Cole, Mailath and Postlewaite 2001b) exist in a general assignment game framework. I then shed light on what enables and what precludes coordination failures. A simple condition, absence of technological multiplicity, guarantees efficient investments for each pair, but a mismatch of agents may still occur. However, using optimal transport theory, I also show that mismatch is heavily constrained in certain multi-dimensional environments with differentiated agents and no technological multiplicity. Under technological multiplicity, even extreme ex ante heterogeneity need not preclude inefficiencies.

Technical Details

RePEc Handle
repec:aea:aejmic:v:10:y:2018:i:3:p:86-123
Journal Field
General
Author Count
1
Added to Database
2026-01-25