[WP-021] Choice or Competition: Does Integration Benefit Everyone?

Author

Yuichiro Kamada, Fuhito Kojima

Abstract

Matching markets are often fragmented, organized at a small local level. While integration of matching markets may lead to welfare gains by expanding choice, it may also harm some market participants by increasing competition for the same resources. We show that every “good” mechanism fails the monotonicity requirement that no individuals be hurt by integration. Then we provide characterization results that identify conditions under which monotonicity becomes compatible with other desirable properties of matching mechanisms.

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