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Article
Hiring Procedures to Implement Stable Allocations
Journal of Economic Theory (1998)
  • Jose Alcalde, University of Alicante
  • David Pérez-Castrillo, Universitat Autonoma de Barcelona
  • Antonio Romero-Medina, Universidad Carlos III de Madrid
Abstract
We implement the stable correspondence of a job matching market in Subgame Perfect Equilibrium. We use a simple sequential mechanism in which firms propose a salary to each worker (first stage) and, then, each worker accepts at most one proposal (second stage). Moreover, if agents' preferences are additive, this mechanism implements in Subgame Perfect Equilibrium the firms' optimal correspondence when firms use undominated strategies. Finally, we construct another simple sequential mechanism where the order of decisions is permuted and which implements the workers' optimal correspondence when agents' preferences are additive.
Keywords
  • Job Matching Markets,
  • Implementation,
  • Mechanism Design.
Publication Date
1998
Citation Information
Jose Alcalde, David Pérez-Castrillo and Antonio Romero-Medina. "Hiring Procedures to Implement Stable Allocations" Journal of Economic Theory Vol. 82 (1998)
Available at: http://works.bepress.com/antonio_romero_medina/2/