Matching markets with farsighted couples [WP]

Abstract

We adopt the notion of the farsighted stable set to determine which match-ings are stable when agents are farsighted in matching markets with couples. We show that a singleton matching is a farsighted stable set if and only if the matching is stable. Thus, matchings that are stable with myopic agents remain stable when agents become farsighted. Examples of farsighted stable sets containing multiple non-stable matchings are provided for markets with and without stable matchings. For couples markets where the farsighted sta-ble set does not exist, we propose the DEM farsighted stable set to predict the matchings that are stable when agents are farsighted.