Stability with one-sided incomplete information
- Author(s): Bikhchandani, Sushil;
- et al.
Published Web Locationhttps://doi.org/10.1016/j.jet.2017.01.004
Two notions of stability, ex ante stability and Bayesian stability, are investigated in a matching model with non-transferrable utility, interdependent preferences, and one-sided incomplete information. Ex ante stable matching-outcomes are unblocked for every belief on the blocking partner's type while Bayesian stable matching-outcomes are unblocked with respect to prior beliefs. Ex ante stability is a minimal requirement. Bayesian stability is a more selective desideratum with sound efficiency properties.