Two-sided matching with firms' complementary preferences

TL;DR

This paper investigates the existence of stable matchings in two-sided markets where firms have complementary preferences, establishing conditions under which stability is guaranteed despite complex preference structures.

Contribution

It introduces a balancedness condition that ensures the existence of stable matchings with firms' complementary preferences and identifies classes of preferences satisfying this condition.

Findings

Stable matchings exist under the balancedness condition.

A class of preference profiles satisfying the condition is characterized.

Stable matching is compatible with various firms' complementary preferences.

Abstract

This paper studies two-sided many-to-one matching in which firms have complementary preferences. We show that stable matchings exist under a balancedness condition that rules out a specific type of odd-length cycles formed by firms' acceptable sets. We also provide a class of preference profiles that satisfy this condition. Our results indicate that stable matching is compatible with a wide range of firms' complementary preferences.