Stable and extremely unequal

Alfred Galichon, Octavia Ghelfi, Marc Henry

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

We show how stability as a solution concept in matching often comes at the cost of extreme forms on inequality. Restricting our attention to aligned preferences, we show that the stable matching results from the lexicographic welfare maximization of the pairs’ welfare, starting with the best-off. We compare this solution with an alternative allocation, that although unstable, maximizes the welfare lexicographically starting with the worst-off pairs.

Original languageEnglish (US)
Article number111101
JournalEconomics Letters
Volume226
DOIs
StatePublished - May 2023

All Science Journal Classification (ASJC) codes

  • Finance
  • Economics and Econometrics

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