Competition and Choice in Matching Markets
Yashodhan Kanoria
Columbia University
Wednesday, November 11, 2015
4:00 - 5:00 PM
Location: GSB G102
Abstract:
The theory of two-sided matching markets has led to successful marketplace designs for school/college admissions, residency matching etc.
Online matching platforms (AirBnb, Uber, Upwork, etc.) offer exciting new opportunities.
Stability is used often as an equilibrium concept in such markets, where agents on both sides of the market have preferences over potential
matches. I start by showing that matching markets are extremely competitive and typically have a unique stable matching (with Ashlagi and
Leshno). This raises the question of how the composition of the market determines the choice each agent has. In a working paper (with Ashlagi,
Braverman, and Shi) we analyze two-sided markets with tiers and study how much search effort is needed to find the stable matching. We find
a “small” amount of search effort suffices, if each agent reaches out to his most desirable potential matches among those who have slightly
less market power than his own. Interestingly, agents should wait for dream matches to reach out to them.
Operations Research Colloquia: http://or.stanford.edu/oras_seminars.html