Matching auctions

Arbeitspapier

We study mediated many-to-many matching in markets in which valuations evolve over time as the result of shocks, learning through experimentation, or a preference for variety. The analysis uncovers the key tradeoffs that platforms face in the design of their matching protocols. It shows that the dynamics that maximize either the platform's profits or welfare can often be sustained through auctions implementing the matches with the highest bilateral score up to capacity. In equilibrium, bidding is straight-forward and myopic. The analysis also sheds light on the merits of regulating such markets. When match values are positive, profit maximization involves fewer and shorter interactions than welfare maximization. This conclusion need not extend to markets where certain agents dislike certain interactions.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CSIO Working Paper ; No. 0144

Classification and Topics

• Classification: Wirtschaft ; Asymmetric and Private Information; Mechanism Design ; Stochastic and Dynamic Games; Evolutionary Games; Repeated Games
• Subject: matching ; experimentation ; platforms ; bandit problems ; asymmetric information ; learning ; dynamic auctions

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Fershtman, Daniel ; Pavan, Alessandro
• Event: Veröffentlichung
• (who): Northwestern University, Center for the Study of Industrial Organization (CSIO)
• (where): Evanston, IL
• (when): 2017

Further information

• Handle: http://hdl.handle.net/10419/213451
• Last update: 10.03.2025, 11:46 AM CET