Strategic disaggregation in matching markets

Autor:	Stephen Nei, Bobak Pakzad-Hurson
Rok vydání:	2021
Předmět:	Competition (economics) Microeconomics Economics and Econometrics Matching (statistics) restrict Moral hazard media_common.quotation_subject Adverse selection Quality (business) Business Commit Payment media_common
Zdroj:	Journal of Economic Theory. 197:105329
ISSN:	0022-0531
DOI:	10.1016/j.jet.2021.105329
Popis:	Decisions agents make before and after matching can be strategically linked through the match. We demonstrate this linkage in a game where universities either require students to commit to majors before matriculating or allow students to pick majors during their studies. The interaction between “matching forces” (competition for higher quality students) and “principal-agent forces” (moral hazard and adverse selection) leads to two equilibria that mirror the admissions systems in the US and England. With monetary transfers, our model provides insights into athletic scholarships. Payment caps that restrict transfers to potential athletes who decide not to play sports can maximize welfare.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::037cf5da24d735d571b08ee62b3ec420 https://doi.org/10.1016/j.jet.2021.105329 Zobrazit plný text záznamu Full Text from ScienceDirect