On the Effi ciency of Stable Matchings in Large Markets
نویسندگان
چکیده
Stability is often the goal for clearinghouses in matching markets, such as those matching residents to hospitals, students to schools, etc. Stable outcomes absent transfers need not be utilitarian effi cient, suggesting the potential value of transfers. We study the wedge between stability and effi ciency in large one-to-one matching markets. We show stable matchings are effi cient asymptotically for a large class of preferences. In these environments, stability remains an appealing objective even on effi ciency grounds, and monetary transfers are not necessary for effi ciency purposes. Nonetheless, for severely imbalanced markets, when preferences entail suffi cient idiosyncrasies, stable outcomes may be ineffi cient even asymptotically.
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